Mr. Speaker, it has been decided to recommend to the State President that the supplementary general registration of voters which I recently announced will commence on 27 July 1979 and end on 25 October 1979. Copies of the rolls which will be compiled in terms of this supplementary general registration will be made available to political parties on 24 December 1979, and the lists will come into effect on 23 January 1980.

With your leave, Mr. Speaker, I just want to give an indication of the business of the House; This coming Friday the Votes of the hon. the Minister of Finance will be discussed here in the House of Assembly. These will be followed on Monday by the discussion of the Community Development Vote. At the same time, i.e. on Friday and Monday, the Plural Relations and Development Vote will be discussed in the Senate Chamber. The Justice Vote will also come up for discussion there on Friday, 11 May.

Mr. Speaker, as usual Ascension Day falls on a Thursday—this year on Thursday, 24 May. This year, however, it so happens that the next Thursday, 31 May, is Republic Day. As is customary the House does not sit on either of those days. So it is only human to consider the prospect of a long weekend.

Hear, hear! [Interjections.]

We have therefore agreed that the House will sit on 25 May, the day after Ascension Day, but that the day after Republic Day—Friday, 1 June—shall not be a sitting day. Consequently I now move without notice—

Agreed to.

Mr. Speaker, I move—

I want to state at the outset that this legislation is in all probability the most important piece of legislation on this particular subject to be introduced in this House for many years.

The object of the legislation is to give effect to the Government’s proposals for the replacement of the existing Regulation of Monopolistic Conditions Act, 1955, by new legislation. This Act has been in operation since 1955 and it has become clear that it has certain shortcomings which are considerably complicating its implementation. It has been necessary, therefore, to revise this Act in its entirety in order to bring it up to date and into line with similar legislation in other Western countries. In this way, in the following countries, either totally new legislation was created or the existing legislation was drastically changed to provide for the prior control, if necessary, of acquisitions: Australia, Canada, New Zealand, England, Germany, Israel, Yugoslavia and Ireland. Therefore South Africa is not out of step with what has already been done in many other countries.

Our object with the Bill is to create more effective legislation in the interests of the business sector as well, and especially for the preservation of the free market system, which is the cornerstone of our country’s economic life. It has never been the intention to disrupt, through the implementation of monopoly legislation, the economic growth and progress of the country in terms of the Government’s overall policy objectives. On the contrary, it is clear that a competition policy as envisaged in this Bill will be formulated and implemented in practice with due allowance for the country’s broad economic policy objectives. It has always been the policy of the Government—and I should like to reaffirm it this afternoon—to place a high premium on the preservation of healthy competition as a very important instrument, in fact, as an important condition, for the proper functioning of the free market economic system in order to carry the country to new heights of economic development. In fact, if competition really comes into its own, if there is full competition in our national economy within the system to which we subscribe, or competition which approaches as closely as possible to that ideal, State interference should be restricted to a minimum.

Naturally, it is quite impossible to formulate a competition policy which can be implemented unchanged by all countries, because the position differs from one country to another according to the peculiar circumstances of each. However, there are—and I want to emphasize this—certain elements of a strong competition policy which are universally applicable and which can serve as a basis on which every country can work out, formulate and implement its own particular policy. In the Bill which is now before the House, there is enough flexibility to create and implement a competition policy which may best serve the Republic’s particular circumstances and needs.

In the light of changing economic conditions in South Africa, it gradually became clear that the existing Regulation of Monpolistic Conditions Act, 1955 (Act No. 24 of 1955), was no longer effective enough as an instrument for the regulation of the country’s general competition policy, and that it did not make adequate provision for the preservation and promotion of healthy competition in the national economy. The need to adapt this legislation, which has been in operation since 1955, to changed circumstances, is not a new development, but has been felt for a long time. In fact, as far back as 1969, a Bill which was to make suitable amendments to this Act was introduced in this House and referred to a Select Committee before the Second Reading. The committee could not complete its task before Parliament was prorogued, and was consequently converted into a permanent commission, which published its report in 1971 (No. RP 40/1971).

†Whereas the 1969 Bill contained comprehensive proposals for dealing with mergers, take-overs and the other forms of acquiring financial control over businesses, the commission’s recommendation was confined to “the control and restriction of the registration of newspapers”. As hon. members may know, these proposals were not proceeded with, so that the legislation for the regulation of monopolistic conditions being applied today is, with the exception of a few minor amendments, still the same as that introduced 24 years ago.

Persistent criticism levelled at the legislation and its implementation over many years, especially the belief in several quarters that the existing provisions and the dispensation for its enforcement were inadequate, convinced the Government that the time was opportune for an entire review of the present legislation.

In August 1975 the Government appointed a commission to review the operation of the Act and, more specifically, to inquire into and to report upon the following: The tendency towards the forming of economic power concentrations by merger or take-over or in any other way whatsoever; the advantages and disadvantages of such power concentrations viewed from the angle of the public interest; and, lastly, the efficacy of the present Act as an instrument to ensure competition. This commission reported in March 1977, and its report was immediately made public. It is interesting to note that this report enjoyed widespread publicity and discussion.

The Commission of Inquiry into the Regulation of Monopolistic Conditions Act, 1955, gave in its report a detailed account of the historical background which led to the present legislation. Although this is not the proper place to repeat this historical background, I should like to highlight only a few important aspects of it.

As far back as 1924, the Board of Trade and Industries was empowered by legislation to advise the Government on—

It is therefore apparent that the Government at that stage already realized the need to empower a body to keep a watchful eye over the tendency to economic concentration in the country’s economy. The Board of Trade and Industries did in fact receive numerous complaints, either directly or via the two departments, namely the Department of Commerce and the Department of Industry, and resolved the majority of these complaints by negotiating with the parties concerned. The Board of Trade and Industries also produced several reports, wholly or partly concerned with monopolistic conditions, restrictive trade practices and the application of the Government’s policy regarding monopolistic tendencies in the economy. Since the promulgation of the present Act, the Board of Trade and Industries has resolved a large number of complaints without having instigated formal investigations and has also instituted about 21 formal investigations into suspected monopolistic conditions and brought out reports thereon.

In its report the commission of inquiry also came to the conclusion that the South African economy, as a result of its historical development, has become highly concentrated. Moreover, the market is relatively small and often there is enough room only for one industry of a kind to fully satisfy the market. This specific aspect of the country’s market structure could therefore lead to more opportunities arising for the creation of monopolistic conditions. Here it is also important to note that although economic concentration has certain definite advantages, the disadvantages thereof could, if not properly regulated or controlled, outweigh such advantages. For this reason, therefore, it is important that provision be made in legislation of this nature for the taking of preventive action where absolutely necessary.

In February 1978 the Government announced its proposals in connection with the recommendations of the commission in the form of the publication of a draft Bill for general information and comment. This was done with the specific purpose of encouraging and fostering public scrutiny and debate. These proposals were, in fact, closely scrutinized by both the public and private sectors. In view of the widespread interest in the draft legislation and the comprehensive representations which were received from a diversity of public as well as private sector bodies, a second draft Bill was published for general information in December 1978. The original proposals were altered to accommodate the comments received, to provide for technical changes, to remove anomalies or to clarify certain aspects of the Bill. The Bill now before the House is this second draft Bill in a slightly modified form.

* Implementation and scope of the Act

No important departure is envisaged from the existing provisions in terms of which the Act will not be implemented in such a way as to interfere with the rights conferred under certain other laws. The laws concerned are the Trade Marks Act, the Designs Act, the Patents Act, the Copyright Act, the Industrial Conciliation Act and the Marketing Act. To this list is now added the Plant Breeders’ Rights Act, 1976, Act 15 of 1976. It is important in this connection that I should emphasize that it was never the intention completely to exclude all those who enjoy rights in terms of the aforementioned laws from the scope of Act No. 24 of 1955 or of the proposed legislation. It is clear from the wording of the sections and the clauses concerned that the exemption is limited in scope and applies only to the exercise of specific rights conferred in terms of these laws. The other economic activities of the parties concerned are just as subject to the Regulation of Monopolistic Conditions Act as those of any other person or body falling within the ambit of the definition in the Act.

A new addition to the provision is that except in so far as criminal liability is concerned, the provisions of the Act will henceforth apply to the State as well in so far as the State is concerned with the manufacture and distribution of commodities. I think this further emphasizes our official standpoint, which is private sector orientated.

Establishment of Competition Board

When the Board of Trade and Industries was established in its present form in terms of Act 33 of 1924, supervision and control of undesirable monopolistic practices was one of its functions. In 1955, there was an important development in this respect when separate legislation for the control of monopolistic conditions was passed for the first time, i.e. the Regulation of Monopolistic Conditions Act of 1955. However, the function of conducting the necessary investigations and recommending suitable remedial measures for the combating of such conditions was still allocated to the board, which carried out this additional responsibility under difficult circumstances and with great distinction and conscientiousness, for which I should like to record my thanks. However, the task of the board as the Government’s adviser on tariff protection policy and such economic problems as are referred to it from time to time has grown phenomenally since 1924, along with the country’s economic growth. At the same time, a need has arisen for a more sophisticated approach to competition policy, especially because of the important structural changes which have taken place in the business world over the past decade or two. This caused the Government to decide, in accordance with the unanimous recommendation of the commission, on which the private sector was largely represented, to establish a separate autonomous body to advise the Government on competition policy in the same way as the Trade and Industries Board was able to advise it on protection policy and specific economic matters.

†Because this new body constitutes a further development of Government policy, I feel that a few details may be of interest to hon. members at this stage.

Name

Whereas the commission suggested the name “Monopolies Board”, the Government felt that more emphasis should be placed upon the positive aspect of its competition policy and therefore decided upon the name Competition Board/Raad op Mededinging.

Composition of this board

Because of the importance of the functions of the board and also the nature of the investigations which will be undertaken by the board in terms of the legislation, it is intended that the board should be composed of persons of the highest professional ability and integrity. In this respect I am sure that representatives of the private sector will be able to make a very valuable contribution as members of the board.

The board shall consist of a full-time chairman and not more than four part-time members and two ex officio members representing the public sector, namely the chairman of the Board of Trade and Industries and the Registrar of Financial Institutions. The reasons for these ex officio members are, firstly, that the Government considers it essential to maintain the expertise on competition policy built up in the Board of Trade and Industries over many years, as well as its valuable store of information on, and insight into, South Africa’s economic structure, which it enjoys as a result of its continuous contact over many years with all sectors of the economy. Secondly, the Department of Finance is responsible for the implementation of several statutes pertaining to the various financial institutions under its control. It is considered that in the execution of these duties there should be co-ordination of the policy in so far as these duties concern matters that may have a bearing on competition. Provision is also made for the appointment of an additional member of the board for a certain period and for a specific purpose from time to time.

The commission recommended, and I have also received requests to this effect from certain interests, that the members of the Competition Board should be unattached. In other words, they should not be civil servants or representatives of vested interests. Although I wholeheartedly support these sentiments, I have to point out that it may not always be possible to find completely unattached persons to appoint as members of boards, especially on a part-time basis. This requirement is therefore not incorporated in this legislation, although I should like to stress at this stage that it will always be Government policy to appoint, wherever possible, independent, objective and unattached persons from outside the public sector to statutory bodies of this nature.

The functions of the board

As emphasized by the commission, a competition policy embraces much more than the undertaking of investigations into alleged monopolistic conditions and the supervision of prohibitions imposed in pursuance of such investigations. An important task of the Competition Board will be to advise the Minister of Economic Affairs on all aspects of economic competition policy, with due regard to the Government’s overall economic objectives. In short, it should establish a workable relationship with and between other official bodies, Government departments and the private sector in particular, in order to coordinate and promote a national competition policy within the framework of other policy objectives for the country.

*One of the first tasks of the Competition Board will naturally be to lay down broad guidelines, for its own use, but also for general information, with regard to problems which may be experienced with acquisitions, in order to give persons or businesses which intend to effect take-overs or mergers an opportunity to ascertain whether their proposed action is in accordance with the guidelines laid down by the board. This policy and these guidelines will naturally be drawn up by the board in close consultation with all interest groups in the public and private sectors and will be revised from time to time as circumstances may require.

I should also like to point out a few other important principles contained in the Bill.

Initiation of investigations

Unlike the present position, the new board will have the right to undertake investigations on its own initiative and without a specific commission from the Minister of Economic Affairs. The implications of this provision are obvious and clear. It will confirm the autonomy of the Competition Board and confer upon it the necessary authority and status which we expect of such a board. But these powers will also enable the board to investigate the activities of the public as well as the private sector, an aspect which the commission feels very strongly about and which I endorse. From the nature of the case, it is provided for in the legislation that the Minister has the right to prohibit or call off an investigation if, in his opinion, such an investigation is not in the public interest.

The burden of proof

I want to explain in this connection that it is clear from representations that have been received that there is considerable misunderstanding about the question of the burden of proof at investigations undertaken by the board. I want to point out from the outset that as far as investigations of restrictive practices are concerned, there is no difference in approach between the existing Act and the Bill which is now before this House. In fact, the position has not changed at all, except that the term “monopolistic condition” is replaced in this Bill by “restrictive practice”.

It is also clear, from the reports of the Board of Trade and Industries concerning investigations it has already undertaken into undesirable practices, that in any case it gave the responsible parties sufficient opportunity, either through its questionnaires or during the hearing of verbal evidence, to show on what basis the relevant conditions for which they are responsible can be justified in the public interest. The Bill does not propose any deviation from the existing principle in this connection.

I want to emphasize, therefore, that I am prohibited, as I am under the present Act, from instructing the board to investigate any restrictive practice—nor may the board itself undertake such an investigation—unless there is reason to believe that such a practice exists and may be contrary to the public interest.

Another aspect to which I should like to refer is the fact that the Bill now provides for the board to investigate proposed acquisitions as well. I consider this to be one of the most important principles in the Bill. Since acquisitions are a fairly common phenomenon in any developing economy and as such form part of business activities, it can never be presumed that such an acquisition can or should necessarily be considered contrary to the public interest Only when the board finds, on the basis of information available to it, that there are circumstances in the light of which such acquisition or proposed acquisition is not in the public interest, it may recommend to the Minister that certain steps be taken against such an acquisition or proposed acquisition.

I should like to emphasize that the normal legal rules applicable to all quasi-judicial bodies will obviously be applicable to the board as well and that the legal rule of audi alteram partem will be carefully observed in all investigations, as the Board of Trade and Industries has always done.

The per se approach

The Government agrees with the commission’s recommendation that the legislation should not contain any per se prohibitions of malpractices, but that the restrictions of competition which amount to de facto monopolistic conditions can only be declared illegal after thorough investigation by and on the recommendation of the investigating body, in accordance with the procedure which has been laid down.

However, it is striking that the commission has identified quite a number of well-known restrictive trade practices and that there have been representations, on the basis of the evidence that has been obtained, for a summary prohibition of some of them.

Professions

The wording of the Bill makes it quite clear that professions can also be investigated in terms of the legislation. This is not a new principle, because such investigations can already be made under the existing legislation.

Penalties

In accordance with the proposals of the commission, the Bill seeks to increase considerably the fines for offences, to serve as a deterrent. Apart from the fact that because of inflation, the fines in the existing legislation are quite inadequate, there is the further consideration—which I wish to emphasize—that the really big business enterprises which are well-provided with capital will not be prevented by a small fine from continuing with illegal activities if the profits they derive from such activities are considerably more than the maximum fine provided for in the legislation.

Annual report

The Competition Board will report in full to the Minister on its activities every year. As is already the case with the reports of the Board of Trade and Industries, the annual reports of the former board will be tabled in both Houses of Parliament every year.

†Mergers and take-overs

On the question of increased concentration of economic power by merger, take-over or other means of acquiring control of another business by an existing business—referred to as “acquisitions” in this Bill—substantial changes in the existing legislation are proposed.

Let me state at the outset that the Government is fully aware of the fact that, by international standards, the size of the South African market is such that it does not always permit the establishment of a multitude of firms in all branches of economic activity. Consequently the Government believes that there should be no unreasonable impediment on the attainment of rationalization of the country’s industrial development. In fact it is in South Africa’s best interest to reap the benefits of the economies of scale where justified, in order to be better equipped to meet international competition.

But it should also be pointed out at this stage that the decision to provide for specific provisions in the legislation to deal with acquisitions does not altogether constitute a new principle. In terms of the existing Act the Government has the power to deal with the results of acquisitions on an ex post facto basis. What is new in this Bill is the principle that is being introduced to scrutinize proposed acquisitions calculated to restrict competition in a manner which may be detrimental to the public interest before these acquisitions actually take place. In other words, preventive action instead of remedial action afterwards will take place.

In this regard the guidelines to which I have referred would be of material significance to the board. As in the United Kingdom, the Minister may, if necessary, even issue a standstill order, requiring the relevant parties not to proceed with the proposed acquisition for a period of three months. This constitutes the period within which the board has to complete its investigations and submit its findings and recommendations to the Minister concerned.

The main reason for this important departure from the existing legislation is that the Government believes, as did the commission, that it is not feasible to allow mergers or take-overs to take place in an unbridled manner, without any power whatsoever to regulate or curb, if necessary, their potential effects on the structure of industry and competition. The provision to deal with economic power concentrations after such concentrations have already taken place, has proved to be very unsatisfactory in every country where it has been tried out. Today there is a tendency in most countries to deal with the situation on a preventive basis because “it is not practicable to unscramble the eggs!” The Government believes that more harm can be done by compulsory dissolution of financial and similar constellations and the divestment of interests than by the possible inconveniences that may be caused by an investigation—and appropriate steps where necessary—of acquisitions before they actually take place.

The Government also took heed of the commission’s warning that it should not be the intention to investigate or scrutinize in advance all acquisitions and that these new powers should be applied with the greatest circumspection, avoiding per se rules and a priori assumptions that such acquisitions are fundamentally undesirable. I would like to stress this. In this regard I wish to give the assurance that it is the Government’s sincere wish and desire that this policy should be applied with the greatest circumspection to ensure the least possible inconvenience and harm to the parties involved in proposed acquisitions and to the country’s economy as a whole. I would like to underline the statement that all acquisitions are not per se disadvantageous or against public interest.

Mention should also be made of the commission’s proposals for a further body, the Merger Tribunal, to conduct inquiries into acquisitions referred to it by either the Minister of the Competition Board. Hon. members will recollect that the provision for such a body was contained in the first draft Bill published in February 1978. The idea of a further quasi-judicial body, in addition to the Competition Board, with specific functions for dealing with acquisitions, was altogether rejected by the private sector. Consequently the Government decided not to proceed with this proposal on the grounds that the special functions which could be assigned to a Merger Tribunal by the commission could just as well be performed by the Competition Board and the Minister of Economic Affairs.

*Finally, I should like to refer to the protection of witnesses. Although the principle of the protection of witnesses exists in our legal system, there are various subtle ways, the most important of which is the withholding of supplies, in which life can be made impossible for a witness—especially a business enterprise—in the business community, with the result that the existing protection for witnesses may be inadequate in this connection. The relevant clause which has been embodied in the Bill is therefore intended to provide protection to witnesses.

As I said at the outset, this Bill was drafted after intensive study and wide and proper consultation. I trust that this legislation, its principles and the concept which underlies it will receive the support of all hon. members.

Mr. Speaker, seldom before have we been able to listen to the hon. the Minister here in the House while he was being so reassuring, so circumspect in his proposals and so obliging in his demeanour. We appreciate that, and we shall be thoroughly mindful of that since we now have to proceed to state our general attitude with regard to this legislation.

It is perhaps fitting—although I do not believe it was planned that way—that we should discuss this Bill today, after the important report this House received yesterday, particularly since it relates to the maintenance and development of the free market system. The other report admittedly does not deal with this aspect of the free market system. It concerns the rights of the worker rather than the rights of the investor and the manager. However, both are absolutely necessary if the free market system is to survive and has to remain sound and productive in this country. In passing I just wish to point out that arguments often take place between investors and executives on the one hand and workers on the other hand on how the economic cake should be divided, on how the benefits arising from our national business economy should be distributed in workers’ wages and shareholders’ profits. What is important in the first place is that there has to be a cake to divide and that that cake should constantly increase in size. It is with that in mind that one prefers to see the principles of the free market system being maintained both at the labour level and at the managerial level.

Perhaps no one is a greater advocate of this system than we are. However, it is important to indicate that we advocate the system for two reasons. The free market system has a fundamental merit. It is because freedom is something good. In the same way as personal freedom in the personal life of a human being is something of great value, something that has to be protected, it is also fit and proper that a person should be able to pursue his task or his business activities with the greatest measure of freedom. Consequently there is a principle which serves as a reason for supporting the system.

However, in our view there is yet another reason. It may even be a more urgent and more compelling reason, particularly under present circumstances. It is that according to all the best available evidence a sound free market system in terms of purely economic efficiency is a better system to have than any form of State-controlled economy. Particularly in view of the trying years that lie ahead for South Africa in the economic field, we should set great store by the highly valuable free market system and protect it. A week or so ago we had one of the most excellent analyses of our economic position and prospects and of the challenges awaiting us that I have ever seen in my life. It came from Dr. Simon Brand, the economic adviser to the Prime Minister, when he addressed the chartered accountants here in Cape Town. He referred to the challenges awaiting us and particularly to the necessity for us to be able to provide employment opportunities at a rate of 250 000 a year and at the same time to make progress with the narrowing of the wealth gap existing between our well-to-do people and our poor. He emphasized that we should have to accomplish all that in the face of the high population growth we have to contend with. It is true that under those circumstances we have a formidable task.

If I could be persuaded that in the face of this challenge, there was another system which was perhaps more effective in the short term than the free market system, I should even be prepared to consider it However, I am not convinced that there is one and I am very pleased that the hon. the Minister has continually emphasized his own committment to the free market system as far as this Bill is concerned.

It is our task to effect and maintain rapid economic growth. To be able to succeed in that we have to be as efficient as possible with the production and marketing of our products and also that we shall have to obtain the necessary capital for investment purposes. However, we shall not be able to obtain all of it from our own savings.

The hon. the Minister has pointed out that the ability to compete is of the utmost importance. Throughout the world, and particularly since the Second World War it has been pointed out time and again that the countries which can compete in export markets, in particular, are the countries that can effect the most spectacular economic growth. One need merely think of West Germany and Japan during the post-war years; of America throughout this period; of Brazil; of Hong Kong; and lately, of countries such as Korea and Singapore, to realize that one should deal with legislation in the light of this fundamental standpoint.

†The question with legislation of this kind is whether it is desirable or not. The hon. the Minister should know—I am sure he does know—that the business world is extremely sensitive to the slightest suggestion of interference from governmental authority in the conduct of its business. The elusive qualities of confidence and of a sense of security in the doing of business, are enormously important in raising the investment rate, something which is of particular importance to us now, in producing the sort of economic growth we need. I am sure that the hon. the Minister is also aware, perhaps more than I am, that it is a principle in the business world, as elsewhere, that the law should be sure, clear and certain. Businessmen are not unadaptable creatures, but they at least like to know what it is they are being asked to adapt to, and I suggest this is going to be of the highest importance in the implementation of the legislation.

*As the hon. the Minister said, the legislation did not fall out of the blue. It supersedes an Act of 1955 which basically embodied the same principles. Moreover, there has been long and serious reflection on the legislation, penetrating deliberations took place, and the legislation has been thoroughly examined by all interested parties.

The hon. the Minister has referred to the necessity for flexibility in the application of the legislation. Flexibility is indeed a virtue, but I trust the hon. the Minister will permit me just to add a word of warning: One should not be so flexible as thereby to create uncertainty; flexibility should not degenerate into fickleness.

I agree.

The greatest possible measure of certainty has to be maintained if one wants to create and maintain business confidence.

As I have already stated, the hon. the Minister emphasized that the legislation has come a long way. Regardless of whatever opinion I might have of it, I must pay tribute to him and his department for the thoroughness with which they have set to work and for the willingness they have displayed in listening to the views of all concerned.

†Then there is the question of concentration of economic power. It is common, and popular, to see concentration of economic power in a pejorative sense. Yet, as the hon. the Minister himself has said, it is very dangerous, particularly in South African circumstances, to over-simplify or overgeneralize in this area. The hon. the Minister has conceded that the South African marketplace is very often small, and that if one is to have the capital investment made, and to have the equipment and the machinery that is necessary to produce, at low unit cost, the needs of the South African market, it is very often extremely dangerous to have too much competition in any particular field. What this tends to lead to is price competition between companies, none of whom do well but which go on, for a long time, competing with one another until they finally reach a point where not one of the competing companies has the capital equipment that it needs. Then it becomes cheaper to obtain the article concerned from abroad, and we are faced either with a balance of payments problem or with structural inefficiency in our own economy. So there has to be the greatest possible care and thoroughness in investigating these matters case by case. Production runs must be of adequate length—that is what I have really been saying—to procure efficiency.

In the final analysis, most industries of any importance are not only producing for this market. They are, in a real sense, in competition with the world outside, the export industries directly and the non-export industries indirectly because, as I have just said in another connection, an industry producing for the South African market faces at least the potential threat of competition from imported products. For this reason, what we really have to go for more than anything else—and I emphasize again, more especially in the testing economic circumstances in which we are today—is low unit cost of production, is economic efficiency, is the proper allocation of resources in the most efficient way.

The hon. the Minister has referred to the fact that certain rights are being protected by this Bill, rights that exist under the Patents Act and other pieces of legislation. This is simply being taken over very largely I think from section 2(2) of the existing Act We have no quarrel with that and really no particular comment to make on it. I think the hon. the Minister did make the point that the protection is, in any case, very specific, being protection of the rights as defined in the relevant Act and not, in general, of the activities of people who could claim security in terms of those Acts.

The hon. the Minister has mentioned that this Bill is applicable to State bodies, and we welcome this very much. This is an important improvement in the legislation. I want to say bluntly that there have been times—perhaps not very recently, but certainly over the last decade or so—when it has been quite clear that State capitalism has gone too far in South Africa, having entered fields where it should not have been, fields in which it has not performed impressively at all and has proved to be wasteful of our economic resources. I am therefore very glad that attempts are to be made in terms of this legislation—at least I presume they are—to keep an eye, not only on the principle of State capitalism—a measure of it one accepts, because it is there, and one does not try to talk it away—but also on the efficiency with which it operates.

The Competition Board per se is new. It does, in effect, replace the Board of Trade and Industries, which had a great many other things to do, whereas this board will confine itself to the matters which are dealt with under this legislation and will be able to apply its attention to them on a full-time basis. Appropriately, I think, this board has been given a greater measure of freedom from the hon. the Minister’s apron-strings, if I may put it that way, than the Board of Trade and Industries previously enjoyed under existing legislation.

I make bold to prophesy that the Competition Board and the legislation will succeed to the extent that the board concentrates on building up a coherent policy, a policy which is recognizable and understandable, as well as a body of case law which will lend itself to reasonably firm interpretation by lawyers and other students of that law, on the strength of which businessmen can then make the decisions that may be affected under this legislation. I want to refer, with due respect and also not altogether uncritically, to the situation which exists with regard to anti-trust legislation and similar legislation in the USA. It would be improper for me to comment on the principles that underlie that legislation. In any event, I do not disapprove of those principles at all. However, people who have had anything to do with the legislation in practice, understand very well why it is that many large American corporations seem to be run by their lawyers rather than by any of their directors.

I agree with you.

The reason for that is that the situation is incredibly complex in terms of the application of those laws and in terms of the existing case law. I hope it will be the object of the Competition Board to build up something that is understandable to ordinary people and that has a logic about it that ordinary men can follow in making their decisions.

If, on the other hand, the board were to act capriciously in an ad hoc way and to create insecurity in the minds of the business people who are seeking to develop larger enterprises in this country, I believe that much harm would be done to our economy and little good to anybody who fancied that he was a victim of a monopoly.

A feature of this Bill that has been commented upon outside is that the public interest is not defined. This is, of course, not a new principle, as it also exists in other legislation. Indeed, if one sets oneself the task, as I did for a short time, of defining what the public interest would be under this legislation, one comes to have sympathy with the fact that it is not defined. I am glad, however, that the hon. the Minister has already said that the public interest is not to be equated with opposition to economic concentration per se, because I could give him many instances in our economic life right now—and I am sure he could give me many more—where economic concentration, with the support and co-operation of the Government, is serving in the public interest, in the interest of our country and the economy.

The Government is itself a concentration.

Precisely. If truth be told, the Government is at this very moment probably the largest concentration of economic power South Africa has ever seen.

That does not mean it is good.

As has been suggested, the question is not whether there are concentrations of power, but rather whether they manage themselves efficiently. That is what we have to get at.

*The hon. the Minister has spoken of the guidelines the board will establish to serve as pointers for businessmen in South Africa. I wish to relate that to my desire that a body of knowledge and legal decisions should gradually be built up to serve as pointers for businessmen in South Africa. I trust that these guidelines will be published in a suitable way from time to time, and that everyone concerned will be apprised of the guidelines so that they may know how to act.

It appears to me as if the board will not only act as a board of inquiry into acquisitions, but that it will also act in a general advisory capacity to the Minister and the department and also, under certain circumstances, I think, to private businessmen. Under certain circumstances it will also serve as a negotiator and go-between. It will therefore bear an immense responsibility. It is therefore really not possible for one to ascertain to what extent the Government is going to succeed until such time as one has seen the board in action. Time will tell of course.

We are pleased that there is adequate provision for appeals with regard to the decisions of the board and of the Minister. It would have worried us if there had been no such provision.

†Finally, I should like to refer to mergers and take-overs. These words very often have a sinister ring in the public mind, and I am aware of a certain delicacy in my personal situation in discussing them. However, in the South African situation the effect of mergers and take-overs, when they take place, more often than not is to reduce costs and, in the long run, to reduce prices—and that, above all else, is what our economy needs to strive for now. We have, as I have said, to compete with the world and we can only do that successfully by applying all our resources, our mineral, agricultural, human and capital resources, in the most efficient way possible.

In conclusion I want to say that there are of course dangers in restrictive practices, as restrictive practices have been defined in this Bill. As the hon. the Minister has pointed out, this is accepted in almost all modern countries and we cannot decline to accept this fact. As I have said, there are also great dangers in Government fiddling with the economy.

On balance, we on these benches think that it is right to afford this legislation a chance. We think that much will depend on how the new board and the Minister conduct themselves. In the meantime we will support the Second Reading of this Bill and will make such detailed comment as we deem necessary during the Committee Stage.

Mr. Speaker, I have great appreciation for the standpoint which the hon. member for Parktown expressed with regard to his commitment to the free enterprise system. I am also a great supporter of this system and in fact I introduced a private motion on this matter in this House two years ago. For the sake of perspective, however, I think it is necessary today to examine the role that the State has to play in the economy and I shall deal with this in the course of my speech.

The hon. member for Parktown also said that businessmen were not unwilling to adjust; they simply wanted to know what they had to adjust to. I think that is a very good point. I think we can rest assured that the Government advocates the maximum freedom in our economic system, provided it is coupled with discipline; discipline within the framework of the community interests, something which is unfortunately not always—as the hon. member for Parktown rightly said—precisely definable.

However, before I analyse a few of these points, I do think that it is necessary to point out that this legislation is probably one of the most thoroughly prepared pieces of legislation that we have dealt with here in years. Over the years representations have been made with regard to amendments to the original Act of 1955. In 1969 a Select Committee was appointed, which was subsequently converted into a commission, and in 1975 a further commission was appointed. The upshot was that a draft Bill was published in February 1978 for comments. In December 1978 a new draft Bill was published and further comment by all interest groups in South Africa was invited. The Bill which is before the House at present, is that Bill, which has been amended only slightly as a result of further representations received.

If the principles incorporated in this Bill are examined, we in actual fact find very few new principles. The protection of rights, under the existing relevant laws as well, is clearly evident, while the Bill does not include existing legislation. I think we should take cognizance of this. The new principle that is embodied in this legislation—and which I consider a very good one—is that the Government is not excluded from the activities of the Competition Board. I should like to emphasize a few of the functions of the Competition Board. One of the most important new principles is that the board will be able to institute investigations itself. As in the past—consequently this is no new principle—the burden of proof rests on the parties to provide proof of their bona fides in connection with a particular inquiry. Undesirable conditions or malpractices are not defined in the legislation itself. It is left to a large extent to the judgment and discretion of the board. The professions are also included in this. Although I initially had certain reservations on this aspect, I found that as far as matters such as normal discipline and the normal functioning of a profession are concerned, these naturally continue to fall under the jurisdiction of the board of that specific profession. This Bill concentrates only on certain facets of professional activities which are prejudicial to the common interest. Therefore I do not think that the professions need really be concerned about this particular matter.

In my opinion one of the most important aspects of this Bill is the fact that it can prevent undesirable conditions, because in terms of this Bill it is possible for the hon. the Minister to issue a so-called standstill order, an order which will take effect till such time as matters have been investigated. Naturally this must save a great deal of expense and trouble, because it is sometimes so difficult to unravel the whole web once an amalgamation has taken place. I think we should make an appeal to the board to implement this legislation with the utmost circumspection and flexibility so that we do not prejudice the profit motive and initiative in this whole structure, because these two aspects still remain the basis of a free economy. As I have already said, the State is not excluded from this. I regard this as an exceptionally important provision in this Bill. It is appropriate that we take cognizance of this, because in the recent past accusations have repeatedly been levelled at the State, in spite of the fact that the State’s role in the general economy is in actual fact extremely limited and in spite of the fact that the Government has repeatedly stated it clearly as its policy that the State does not want to interfere in the private sector, but chiefly confines itself to the regulatory function of the State. These accusations have been made despite the fact that the Government announced steps to divorce certain Government corporations from competition with the private sector and in spite of the fact that in reality this so-called socialization process, which is supposedly in progress in South Africa, does not exist if we examine the facts. I should just like to point out a few facts in this regard. Government employment as a percentage of the total number of economically active persons in South Africa has in fact gradually decreased. Government expenditure as a percentage of the gross domestic product has remained almost constant and where it has risen, it was caused by the stockpiling of certain strategic provisions over a specific period. I should also like to point out that the contribution of the public sector has also remained reasonably constant over a very long period and only rose considerably during a specific period of enterprise when it was absolutely unavoidable.

I should also like to point out that as far as capital goods are concerned, the Government’s contribution has in actual fact not risen much if it is taken into account that South Africa ias a developing country and that a comprehensive infrastructure has to be established by the Government. Yet this type of accusation continues.

Before we get carried away by the provisions of this Bill, to which, as I have already said, the State is also subject, I think that we should examine a few other aspects if we wish to gain perspective, because an economic system is a complicated and a sensitive combination of interdependent activities, a system which should aim at satisfying the needs of the community in all its facets in a continually changing social, political and technological environment. This is a mouthful, but the point is that in this structure we cannot in truth speak of State interference; we must really speak of State intervention or regulation. The system of free enterprise, of a free market economy, cannot create the necessary equilibrium on its own. Absolute capitalism no longer exists and cannot function in its original absolute form. The State must of necessity act as regulator as well as producer—please note—in specific circumstances. But the question is: Where must the line be drawn between intervention by the State and the free market economy? In this regard I think that the Competition Board is going to play an extremely important part in determining in fact where this line must be drawn. I think there will also be good cooperation with the committee in regard to State competition which functions under the hon. the Minister of Economic Affairs in order to spell out clearly where this line ought to be drawn. It should be taken into consideration that there are certain sectors where the State has to act as producer, as I said a moment ago. We think, for example, of community services, health, the provision of the infrastructure, police and defence.

As an entrepreneur the State has to act when an enterprise or a project is too large for the private sector, which has already happened repeatedly in our history. The State has to act as entrepreneur when products of strategic importance have to be manufactured, as in the case of steel and petrol. For social reasons the State also has to act in the case of housing. Sometimes, for economic reasons, the State sometimes also has to function as a monopoly, as in the case of the S.A. Railways, which could otherwise not have been operated beneficially for the country as a whole. In other words we are emphasizing the fact that a monopolistic condition is not necessarily prejudicial. Therefore I think that when the Competition Board considers matters, this premise will be considered very carefully.

Owing to strategic considerations the State often has to take over private enterprises, particularly when private business enterprises are in financial difficulties, but I hope that this will be of a temporary nature. However, we must accept the fact that under specific circumstances the State will have to interfere in the economy to this extent. But the State’s major task is that of regulator, and I think that the Bill before us, does in fact emphasize this specific aspect.

I should also like to refer to a few other facets where it is essential for the State to act as regulator. I am thinking, for example, of the deficiencies existing in the capitalistic system as a result of which the Government has to make certain adjustments by means of price control, rent control and interest control. Naturally it is also essential for the State to control cyclic patterns by means of fiscal and monetary steps, as we do annually by means of the budget. Naturally the State also has to act to stabilize and improve the country’s balance of payments and therefore interferes in the economy as far as imports and exports are concerned. Sometimes it is also essential for the State to stimulate certain specific industries by way of tariff protection, concessions or technical aid. Although this is of a temporary nature, it is indeed sometime necessary to supply private enterprises with capital as well. But we should not confuse this function of the State with interference. In this regard, for example, we think of the necessity of decentralization and the development of geographically circumscribed development areas for economic and social reasons and in order to eliminate certain deficiencies. This also applies in our specific case with regard to homeland development. Where the State has to take certain economic steps with regard to homeland development, I believe that this aspect, under the provisions of the legislation before this House, ought not to be or cannot be prejudiced in any way. Naturally the State also has certain important duties with regard to the protection of minority groups. In this regard I am thinking, for example, of the growing necessity for the State to promote farming interests in future.

The most important aspect of the Bill is, in my opinion, “to change the ugly face of capitalism”, the ugly face of the capitalist system, which is known as exploitation. We must realize that the capitalist system is at this stage engaged in a never-ending struggle with the socialistic system, or the communist system. If we cannot succeed in projecting the image of the capitalist system, the system of free enterprise, in such a way that it is acceptable to the masses, we will of course lose in the end.

Incidentally I also want to mention that there are many other areas where the Government has to play a very active economic part. In this regard I am thinking, for example, of the equal distribution of income by means of differential income tax, the elimination of the wage gap and estate duties. There are also important aspects in legislation—this also applies to the legislation before the House at present—to protect the private sector against itself. In this regard we think, for example, of how the private sector has even succeeded in making serious inroads into our fish resources in the past. For that reason it is so essential that the State has to intervene in these matters, in order to protect the private sector against itself. In this regard I can also refer to nature conservation, the protection of the mining industry, the determining of norms for advertisements, hire purchase regulations and last but not least, standardization, which actually protects the public and is to a certain extent directly involved in the overall market economy.

This Bill therefore plays a limited part and should in my opinion be seen against the background of all the other existing laws to which the hon. the Minister referred in his Second Reading speech. I think this is a very serious matter, and I want to appeal to the hon. the Minister to apply decisions in terms of the provisions of this legislation very judiciously and with the utmost circumspection. I should also like to express my gratitude to the hon. the Minister for the assurance he gave this House in this regard in his Second Reading speech. This is a well thought-out Bill, on which we should like to congratulate the hon. the Minister and his department We shall meet an essential need in our economic system by agreeing to this legislation.

Mr. Speaker, I should like to tell the hon. member for Newcastle that we in the NRP agree with him that the State has a tremendous role to play in the economy of South Africa. We can see the need for the State involving itself in, what we term, State corporations in the best interest and for the common good of all the people of South Africa. I should also like to say to him—as the hon. member for Parktown said earlier on—that such aspects as the economy of scale is forcing big business in South Africa, a country with limited markets, to form what could be termed monopolies, although I prefer not to use that term at the moment. This economy of scale is a valid contention on the part of people who are involved in capital intensive business, and therefore we will concede that this is a consideration that has to be taken note of while we are debating this particular Bill. I was particularly pleased, however, to see in the Bill as the hon. member has just told us, that it contains a good concept, i.e. that State corporations should also fall under the jurisdiction of the proposed Competition Board, so that the economy of South Africa can be protected against not only the ugly face of capitalism, as the hon. member put it, but also against what I would like to call the ugly face of socialism.

It goes further than that. It also includes State departments.

Yes, it does include State departments. I am very pleased to hear the hon. the Minister say that. This certainly includes State departments. However, having said that, I am also sure that this legislation can be or could be criticized by some people, because after all it does provide for a board to be established, a board which is going to investigate and advise the hon. the Minister and the Government on the broad concept of competition in the economic policy of the country. It is also going to have the power to investigate various companies, various mergers, take-overs and acquisitions, as these are termed in the Bill. Apart from that the board will also have the powers to adjudicate with regard to what is in the best interests of the public. Therefore, it could be said that this points towards too much State interference in the private sector.

No doubt there will be many free economy purists who are going to criticize the Bill for this. However, I do believe this Bill must be seen not only in the light of South Africa’s experience—as the hon. the Minister said in his Second Reading speech, the present legislation goes right back to 1924—but also in the light of the experience elsewhere in the Western World where we find nations believing in the free economy and in the principles of free enterprise. If one studies this Bill, and if one studies the hon. the Minister’s Second Reading speech, one sees that there has been a tremendous amount of investigation into this particular legislation. After all, the commission was appointed way back in 1975, and took nearly 20 months—until March 1977—before publishing its report.

The draft Bill was submitted in February 1978. In discussing this with the private sector we have found that this draft Bill has been widely circulated and closely scrutinized. We have also found that many memoranda have been submitted to the hon. the Minister.

What is your attitude towards the Bill?

If the hon. member for Von Brandis would just sit quietly for a while, I will tell him what my attitude is. In the light of this experience, and in the light of the history of this particular Bill and the depth of investigation, I should like to inform the hon. member for Von Brandis that the NRP is going to support this Bill. [Interjections.] However, I have only one query which I want to put later to the hon. the Minister. It is not a serious query. It is something though which, I believe, is in the best interests of all concerned.

In view of these powers which we are now being asked to give to this Competition Board that is going to advise the hon. the Minister on the drafting of legislation in connection with competition in our economic policy and in connection with adjudicating on such matters, we wish to take this opportunity of stating the views and attitudes of the NRP towards the economy. I do this in the hope that the hon. the Minister and the Competition Board, which is eventually to be appointed, will give our views due consideration during their future deliberations.

I must state that I agree wholeheartedly with the hon. the Minister when he says that the free market is the cornerstone of our economic life in South Africa. In fact, I am sure that Hansard will reveal—I am sure hon. members sitting in this House will agree—that the NRP is the free enterprise party. [Interjections.] We are the party who believe in the individual. We believe in the strength and the power which comes from the fire in the belly of the individual who has the initiative, drive and desire to accomplish things. This drive and fire in the belly can only come about when the individual is suitably motivated by what is termed the free market forces. Motivation is the essence of achievement in every field. What is it that motivates the businessman, the entrepreneur? Firstly, it is the sense of achievement and the sense of self-fulfilment. That is, after all, what freedom is all about The individual is free to achieve and do his own thing. It also originates from a system which allows the individual to benefit from and enjoy the fruits of his own ability and efforts. My party and I believe that this is essential in any young country, a young country which is still developing and especially a young country which has vast numbers of people who are still very far down on the economic or social scale. A young country needs this type of effort so that it can have the absolutely necessary and essential growth in the economy which is needed to provide the jobs and the prosperity for the masses. South Africa today needs men of initiative, entrepreneurs, a spirit of adventure and people who are prepared to take a risk and people who are prepared to work 16 or 18 hours a day to develop this economy so that all our people can prosper.

I believe that this spirit and attitude is especially necessary in South Africa today where our Brown and Black people, because of the economic development in South Africa and because of their rising educational standards, have within themselves, in their soul and belly, a rising expectation and rising aspirations in respect of what they want to get out of life in South Africa. Therefore, my party and I believe that our economic system must also clearly show these people, and not just the Whites, that they, too, can enjoy the benefits of the free enterprise system, providing—and there is always a proviso in this—they are prepared to work and compete in this particular type of economic system.

This in turn raises the point I believe to be the crux of this Bill, namely that our economic system must be so structured as to allow the people, Brown and Black as well as White, to compete freely and competitively with all groups within the South African economy. My colleague, the hon. member for Mooi River, has repeatedly stated that South Africa today is fighting ideological battles for the minds of the Black people. It is a battle of philosophies, a battle between the free enterprise, capitalistic philosophy and the traditional philosophy of Black Africa which is one of communalism in which the individual is not important. That is the traditional concept or ideology of Black Africa. There is however, a new ideology being fed to them, namely the ideology of socialism and communism. This battle, which we are fighting in Southern Africa and in Africa as a whole, is a battle we have to win. Therefore, it is absolutely essential to retain a competitive and free economy in which any individual, Black or White, who has the ability, the wherewithal—after all it is a capitalistic system—and the desire to compete, can in fact compete because the system allows him to compete.

Another reason for maintaining a free and open economic system is that this is the basis of the confidence which the average man in a Western free enterprise country has in his system. Generally speaking, the average man in a free economy enjoys a fairly high standard of living. This is so because of the system. If we do not allow this system to prevail, the common man will begin to pose questions. There is a second reason for maintaining this system, and that is that competition is also the basis for the efficiency and high productivity of our system, especially when it is compared with the socialist and communist systems throughout the world. Therefore, as I have said, it is absolutely essential to our future that we maintain our free economy.

Having said this, however, I must agree with the hon. the Minister—as I said at the beginning of my speech—that South Africa does have certain circumstances peculiar to the country and also peculiar to our present state of development, which can and does, I believe, necessitate a concentration of effort and capital—even to the extent where it could be called monopolistic—for the common good. One can say that the S.A. Railways is a good example of this, and so is Escom. One could also say that in the private sector some of the very large capital-intensive industries are other areas where it could be conceded that a monopolistic situation is possibly to the common good, provided of course, as the hon. member for Parktown said earlier on, that these are run efficiently and are properly managed and do not just become concerns where inefficiencies and low productivity can creep into the system.

I do qualify what I have said, however, by stating that I believe that these situations are few and far between, and in the long-term future interests of South Africa I believe that these should be kept to a minimum. I also believe that all of us—the hon. the Minister, other hon. members in this House and eventually, I hope, the Competition Board—must bear in mind what the hon. member for Newcastle has called the ugly face of capitalism. I believe in the profit motive and in the capitalist system. In fact, I believe in mergers and take-overs if these are in the best interests of the country and its economy. I personally believe in them and have, in fact, in my own small way, been involved in them. However, there is a tendency, in certain quarters today, amongst some capitalists, to squeeze the greatest possible profits out of their enterprises, often at the expense of their own labour and staff, often at the expense of the environment and, might I say, not only at the expense of the quality of life of the people who work for them, but also at the expense of the quality of life of the people who come into contact with such organizations. They then use these profits, and also in some instances their monopoly on the available capital resources at any particular time, to expand their organizations by, might I say, ruthless and cut-throat competition and by manipulating their economic power to force bankruptcies, or to force individuals to sell. As an end result one often finds a large conglomerate which may, in conjunction with a similar organization, end up fixing prices, a matter which is discussed in the Bill.

The result of all this growth of the monopolistic giants can, I believe, do a tremendous amount of harm to the free-enterprise system, as the hon. member said earlier on. I believe that there is a danger of this in all the free economies of the world, and I think this is one of the reasons why legislation such as this is required. These people, to whom I have just referred, who are on the ugly side of capitalism, not only do the free enterprise system a lot of harm. They also do freedom a lot of harm. They do a lot of harm to all the people who believe in the freedom of the individual, especially today when the battle of the world is a battle between the “haves” and “have-nots”. I believe that we should stress these aspects in this House and in our media so that the “have-nots” in this country will appreciate and understand that there is a system in South Africa which will enable them, if they have the ability, to rise above what could be called their rather low economic standing at the present time.

In certain quarters there are many people who say that, if the capital resources are concentrated in the hands of too few capitalists, they might as well be concentrated in the hands of the State. I think this is a danger the whole of the Western World faces today. I should like to quote from The Argus of 24 April as it reported what was said by the hon. life president of the NRP, Sir de Villiers Graaff, when he opened the Round Table Conference in Port Elizabeth recently—

In the very same paper an article appeared entitled “Call for equal trading rights for all races”. I should like to quote what Prof. H. P. Muller, director of the Graduate School of Business of Stellenbosch University, is reported as having said when he addressed the Johannesburg Chamber of Commerce—

I believe that these quotations sum up the point I have tried to make.

South Africa is today at the cross-roads. We hear of many visions. A week or so ago the hon. the Prime Minister gave the House his vision of the future for South Africa. Just yesterday, as the hon. member for Parktown has stated, we obtained the Wiehahn Commission’s report which, let us face it, holds out great visions in the field of labour. I agree with the hon. member that, when we talk about competition in the free-enterprise system, it does not only involve the capitalist and the man who is running a business, but it also relates to a partnership which is shared with the employees and workers. I should like to say that the vision of the NRP is one of an integrated economy open to all South Africans who can compete—and I say that in the accepted interpretation of the word, bearing in mind what I have said about the ugly side of capitalism—and who should be allowed by the constitution of this country to compete. I do not want to bring the party political aspect into this, but I want to say that I am very pleased that the governing party has now departed—I say this especially in view of the Wiehahn Commission’s report—from some of the rather restricting and stifling aspects of their apartheid philosophy of the past. They are now, I believe, giving a new vision to South Africa, a vision which I believe is in the best interests of all concerned. We must build on this. This country must build on the work ethic in which our forefathers and the pioneers this country believed, and which enabled them to build South Africa into the State it is today. We must believe in and build on an open economy in which every man must be paid his due, in which every man must be able to enjoy the fruits of his efforts and in which every man has a chance to compete. It is because of these things that, after studying the Bill, we find we can give it our wholehearted support. We think it is extremely good for the future economic progress of South Africa. We hope, of course, that the hon. the Minister and the Competition Board, when advising the Government on its economic policy, will bear in mind the ideals to which this party and, I think, everybody who believes in a free economy subscribes.

Having said that, I should in conclusion like to come back to what I said right at the beginning, viz. that I have one query. That query is in connection with the composition of the Competition Board. In clause 3(2) the size and composition of the board are clearly defined. We in these benches believe that it is essential that on that board there should be a member or members with a lot of practical experience in the day-to-day cut and thrust of the free economy.

I agree with you.

The hon. the Minister says he agrees with me, but he did say in his introductory speech that it has been said that members should be “unattached”—that is, I think, the word he used. He said that was recommended by the commission. We agree that it is desirable that all the members of the board should be unattached, but the board will be working out policy as far as the future economy and competition in South Africa are concerned. They will also be adjudicating on acquisitions as defined in the Bill.

Therefore we in these benches believe that it is in the best interest of all concerned that at least one member of that board should be a suitably qualified and a practical person from the private sector. He must be a person who, as I have already said, has vast practical experience. Perhaps it could be someone nominated by private sector organization such as the Afrikaanse Handelsinstituut and Assocom and the FCI. A person nominated by these organizations should be able at all times to put to the board in its deliberations the practical problems which arise in the cut and thrust of the free economy.

Having said that, I take pleasure, on behalf of my party, in supporting the Bill.

Mr. Speaker, the hon. member for Amanzimtoti has covered a very wide field in the speech he has made in support of this Bill. The hon. member has referred to high standards of living, to White and Brown participation in the economic life of our country, to commerce, to social orders, to communism, to social aspects and to the necessary motivation of the youth of the country to build up our economy. Such references do, of course, cover a very wide field. The hon. member has the marvellous ability to erect a wall and then to come into this House with arguments to break down the wall which he himself has erected. He is well known for that. We appreciate, however, that the hon. member, on behalf of his party, accepts the necessity of a measure of this nature for the economic good of South Africa.

I am sorry that the hon. member for Parktown, who accepted the Bill on behalf of the official Opposition, is not present because there are two aspects of his speech to which I should certainly like to refer in the course of my remarks. The first of these two aspects is the question of “public interest” mentioned in the Bill, but not defined in it.

I think the Bill should be seen in the light of the declared economic policy of the Government, firstly in regard to the maintenance of the free-market principles and secondly in terms of the broad economic objectives to expand and maintain open-market competition. In the third place the Bill should be seen in the light of the Government’s recognition that the open-market system is essential for the future economic development of our country. In the fourth instance it should be seen against the Government’s objective to restrict State interference in the market place to the minimum. Those are four of the basic principles of the Government’s economic policy and the Bill should be examined and assessed in that light.

The Bill is the result not only of a commission’s report, but also of an on-going investigation into these aspects over the past quarter century since the introduction of the principal Act now to be replaced by the Bill. It is also the result of intensive comment this past year since the report of the commission of inquiry into the working of the monopolistic conditions under the Regulations of Monopolistic Conditions Act, 1955, became available. It was also, let me say, one of the most exhaustive studies ever conducted on the South African economy in the four major divisions of manufacture, distribution, mining and finance. This information is contained in the report of the commission. This survey clearly showed the high degree of economic power that is concentrated in these important fields of our economy. While accepting that a concentration of economic power is in itself not without certain advantages in a country such as South Africa, the commission did consider that there was a necessity for Government surveillance of the behaviour as well as the structural aspects of our economy. They considered that concentrations, as such, militated against the effective market forces and could contribute to the undermining of the free enterprise system. I wish to emphasize that the commission of inquiry did not condemn in principle the possession of economic power, on whatever basis it is held, but accepted that the guiding principle should be the demands of public interest. I think I am correct in saying in general that it is my party’s policy in the realms of commerce and industry to keep all occupations open to all and to remove all obstructions that may exist in the path of opportunity for every citizen. Since this is the declared policy of my party, I want to tell the hon. member for Amanzimtoti that he cannot claim that right exclusively for himself. We want, as far as possible, to encourage private initiative and enterprise, and to allow market conditions to be governed by a free interplay of competition.

It is interesting to note that the commission, after examining the effectiveness of the existing Regulation of Monopolistic Conditions Act and its implementation, concluded in its report that it was of the opinion that existing legislation “had but a modest impact as an instrument for ensuring competition in the South African economy”. Compared to existing legislation, this Bill emphasizes the positive aspects of a free enterprise economy. I think I am correct in saying that there are no negative aspects whatsoever in this Bill. There is no list of prohibitions. Under the provisions of this Bill no action can be taken until a de facto situation has been shown to exist in regard to restrictive trade practices or acquisitions, or until we have, in the words of the commission, “the existence of a monopoly”. It is to give effect to the commission’s proposals in this regard and with the positive aspect in mind that it is stated Government policy to promote free enterprise, that a separate Competition Board is provided for in the Bill, a board which either by the direction of the Minister or on its own initiative can conduct an inquiry into a monopolistic practice or any action contemplated that may lead, in the opinion of the board, to a restrictive trade practice.

The hon. the Minister, as well as the commission, has pointed out that, because of the highly concentrated nature of the South African economy and because of the relative smallness of our country’s market structure, conditions could more readily exist for the creation of monopolistic conditions through capital or the market exploitation of goods and services.

I understand the delicate position of the hon. member for Parktown, as a result of which he preferred to restrict his comments to the question of mergers and take-overs. I do not, however, find myself in the same delicate situation so that I can perhaps speak more freely. I should like to indicate what has happened since 1 January 1977. The authority I shall use is the Stock Exchange Handbook, 1979, Volume 1. This handbook lists companies which since 1 January 1977 have had their names removed from the Stock Exchange listings. In all, a total of 48 public companies have had their names thus removed since 1 January 1977. These are companies in which the public of South Africa had a direct shareholding. They could participate in the stock listings of those companies on the Johannesburg Stock Exchange. These 48 companies covered interests in such marketable consumer goods as shoes, hosiery, electrical goods, textiles, liquor, steel fabrication, clothing, foodstuffs—such as eggs, let me say—and chemicals.

Mr. Speaker, may I ask the hon. member a question?

Let me finish my argument please.

How many of those companies were showing a loss?

Order! I want to point out to hon. members that it is becoming an undesirable habit among hon. members for an hon. member, when he is not given permission to put a question, to continue to put the question nevertheless while seated. The hon. member for Von Brandis may proceed.

The majority of these delistings took place as a result of takeovers—I am not saying it applies to all of them—or an amalgamation of capital interests.

Are you referring to companies which have been delisted on the Stock Exchange?

Yes, I am referring to those which have been delisted on the Stock Exchange. They were all formerly quoted public companies. These delistings also took place as a result of capital seeking further investment fields. In other words, a holding company could have made a successful bid to minority shareholders as quoted on the Stock Exchange as a result of which the company became a wholly owned subsidiary. This, let me say, has happened in most of the cases I have referred to.

The shareholders still have shares, but then in the holding companies.

That is not necessarily so, because in the majority of cases the minority shareholders are bought out If a shareholder is bought out, it does not mean that automatically and of necessity he has a shareholding in a holding company. That is the whole point.

I am in no position to say, nor do I wish to infer, that this absorption of listed companies was not in the public interest I do not wish to infer that in any way at all. At a very rough estimate, I would consider some R1 000 million to have been involved in these takeovers or these delistings. That is a very rough, conservative estimate. I am not enumerating the number of shares that were held by the public, the minority shareholders.

In regard to these delistings one thing is absolutely certain and that is that the South African public’s investment opportunity was restricted. I doubt whether that is in the public interest. In view of this large figure, it is perhaps to be welcomed that the new Competition Board will be empowered to take a look at such economic activities on its own initiative. The question, however, can be asked: What would be the position today in regard to some of these listed public companies which have been taken over if they had been subject to scrutiny in terms of the guidelines outlined by the hon. the Minister in his Second Reading speech? That is the question that should be answered. Economically speaking, in regard to the powers granted to the Competition Board, the answer is that prevention is better than cure. As the hon. the Minister has indicated, these powers will be applied with the greatest circumspection and the assumption will not be made that all acquisitions are necessarily against the public interest.

The commission also dealt at some length with the steps taken by other Western and Eastern countries to up-date their legislation. If one considers the expansion of our own economy over the past quarter century and one considers what a monopoly can do against public interest, then the need for this legislation is very apparent Monopolies are born out of a free economy or from the freedom of private initiative—they are born from nothing else. But the danger is that, once they have arisen, they tend to destroy the freedom from which they were created, they tend to suppress freedom and private initiative. Monopolies are not only economic dangers, but they can also become political dangers. There are few monopolies that can resist the temptation to obtain political power to extend their economic power or to ensure their continued economic existence. Monopolies, particularly if they stand together, can influence political opinion. Big monopolies, as evidenced not only in our own country but also in other countries of the Western world, always try to get a hold on public information media, by such means to increase their political and economic power. It has been suggested in certain circles—I refer to people outside and not inside the House—that, because of the limitations in certain fields of the South African economy, a monopoly or a concentration of capital interests could be beneficial to the public interest because the monopoly operates more efficiently than the smaller entrepreneur. This, I say, has not yet been proved and I do not think that any economist in this House can put forward an argument to prove that, not even the hon. member for Parktown. Few such monopolies, where they have existed, have resisted the temptation to eliminate competition, increase prices and curtail production. We have recently seen in our newspapers that the price of eggs has jumped by 8c per dozen, something which has never happened before in the whole history of South Africa. My contention is that it is the direct result of a take-over that that situation has arisen.

There is the other factor with regard to monopolies that, through their entrenchment in a particular market, they can keep new ideas, new processes, new competitors and new marketing concepts from developing and so retard economic development in our country. I mention these few aspects to emphasize why we need a separate Competition Board which, acting on its own initiative, can keep a watchful eye on these dangers to our economic life. The constitution of the board and the principle the hon. the Minister has accepted in this regard, namely that captains of finance and of commerce and industry will be subject to scrutiny by their peers, can only be applauded.

The hon. member for Parktown had a lot to say about public interest I know that one of the criticisms of the Bill—and the hon. member for Parktown echoed it here today—is that there is no definition written into the Bill as to what is in fact the public interest. I welcome the fact that there has been no attempt to define “public interest” in the Bill, because the board will act in terms of what it considers to be the public interest. I also contend that it is not possible to give any clear definition of “public interest”.

I believe that one of the strong points of this Bill is that no attempt has been made to define what “public interest” is. The public interest, I contend, differs from time to time, from generation to generation. What is in the public interest today may not be so tomorrow. Every period of our history has its own needs. The public interest in a time of inflation could be entirely different to what would be considered to be the public interest in a time of deflation. In an inflationary period, the public interest might demand that steps be taken against a monopoly. In a deflationary period, however, the opposite might be desired. There are many different economic factors that can determine what will be in the public interest in a certain period. I hope the hon. member for Parktown will therefore agree with me that it is impossible to give an exact definition in the Bill of what “public interest” is. When investigating a situation, the board will have to decide on that in terms of the conditions that apply at the time of those investigations. I see this as being one of the positive functions of the board.

I think that, in the light of the way in which this measure has been presented and in the light of the fact that it has received such vast and intensive consideration by a highly qualified commission, it has brought economic factors to life that we have never had in South Africa before. Because the Bill brings this about, I think that we on this side of the House can support the measure wholeheartedly.

Mr. Speaker, I should like to say to the hon. member for Von Brandis that this is one of the few speeches, if not perhaps the first speech, in which he has not fought with the Opposition. In fact, the House is perhaps almost too tranquil for the hon. member’s liking.

I am battling with tranquillity myself at the moment.

If the hon. the Minister is also battling with tranquillity, I shall have to see whether we cannot do something about that.

The hon. member for Von Brandis made some very interesting observations, and I find that we agree with a lot of what he had to say. In the course of my speech, I shall refer to some of the matters he dealt with. He referred to the public interest, and in that respect I agree with him that everything depends on the prevailing circumstances at a particular point in time. The Competition Board is going to have to be alive to that situation, and it is going to have to allow what the previous Speaker had to say as its main guideline when it considers what is in the public interest.

In regard to the Economic Advisory Board of the hon. the Prime Minister, I should like to say that we have found that Dr. Brand, who is on that board, said recently that 800 000 Blacks are presently unemployed. He also made the statement that each year for the next 10 years approximately 260 000 Blacks will enter the market as job seekers. In these circumstances, the Government has to pull out all stops to ensure economic growth. They will have to give private enterprise more incentives and more concessions to start new undertakings and to expand existing undertakings. Apart from the De Kock Commission report in regard to the financial rand, the Government has helped foreign investors enormously. The Government has also been of some assistance to local investors, but I feel that the assistance that they have given in this regard is not nearly sufficient to ensure that existing businesses are expanded and new undertakings are set up to help curb unemployment.

This legislation is necessary—of that there can be no doubt. It has in fact been said on all sides of the House. The current legislation dealing with monopolistic conditions was passed some 24 years ago and does not meet present-day requirements. We may debate the various provisions, but the concept and the general principle to maintain and promote competition in the economy should not be a subject of dispute amongst any of us, as I do not think it is. Many countries, for example Canada, Australia, Germany, England, Japan and a host of others, have legislation to deal with some of the matters under discussion.

On pages 81 and 82 of its report, the commission deals with the attitude of Germany and Japan to merger and consolidation. These are two of the world’s most impressive and strongest economies. In 1945 the German economy lay in ruins. Many of its industries were absolutely non-existent But during the last 30 years their economy has boomed and their growth has been spectacular, admittedly by virtue of extraordinary aid, because the Marshall Aid plan and other aid from various quarters which they received, was of enormous assistance to them.

Compared to many of the countries of Europe we have, industrially speaking, a young economy, but like Germany and Japan, South Africa is a country that has enormous potential for growth, provided we harness all our forces together. I believe that we can learn in many respects from these countries because they also experienced the same sort of teething problems that we are presently experiencing.

The free enterprise system must be promoted, and the Competition Board must in its charter be committed to do everything possible to promote free enterprise. The free enterprise system must be encouraged and nurtured amongst all race groups in this country. I believe that the Coloured Development Corporation, the Indian Development Corporation and the various Black corporations also have a vital role to play in this regard. The Competition Board must examine and strengthen the free enterprise system, and I say this specifically because there is a tendency for private business enterprise not to keep pace with its share of the gross domestic fixed investment in South Africa.

In 1946 private business enterprise was responsible for 63% of the gross domestic fixed investment This declined gradually to 46% in 1977. The share of public authorities and public corporations together increased from 37% in 1946 to 54% in 1977. In any event but more especially because of our unemployment situation, it is most disturbing that private business enterprise has lagged behind. This is a matter of grave concern and needs an in-depth investigation.

I would like to ask the hon. the Minister to refer this matter either to the Competition Board or to set up a separate commission to investigate the situation in depth. In terms of clause 6 of the Bill, which deals with the functions of the board, the matter that I have just raised is a matter that could well be referred to the Competition Board. However, it may be that they start off with so many problems that the hon. the Minister may wish to refer this particular problem to a separate commission. The Competition Board will obtain much of the information it requires from various Government departments and will be able to call on such bodies as the FCI, Assocom, the Handelsinstituut and others to assist them in its investigation. I am convinced that when they undertake this investigation, they will find that private enterprise requires more incentives and concessions and urgently requires to be stimulated. The hon. the Minister is smiling at me. He was not here earlier on when I referred…

I was.

… to the fact that foreign investors now have an incentive through the financial rand. I also said that private business enterprise had received some assistance, but not sufficient concessions and assistance to enable them…

I heard what you said.

I hope that the hon. the Minister agrees with what I said.

I heard what you said.

The hon. the Minister says that he has heard what I said, but he does not say whether he agrees or disagrees. Competition is one of the ways of curbing inflation and one often wonders if certain South African industries are not overprotected against imported goods. I am therefore pleased to see that one of the penalties that can be imposed against an offending firm, is that there can be a suspension of duties to be paid on imported goods. I think that is a very good move. The Bill provides for the fact that the board must hear the other side. This is an important facet of our legal system and will ensure that the board is possessed of all the facts before coming to any conclusions regarding these matters. The commission must be commended, and hon. members of the SAP would like to commend the commission for its in-depth investigation and the report it has presented to us.

This legislation affects vested interests, and because it is important that this legislation must not just be rushed through, the hon. the Minister’s department is to be commended, because, early in 1978, it published one draft Bill, and towards the end of 1978, it published a further draft Bill, both these draft Bills being published and circulated for comment. Therefore, we are today actually dealing with a third draft Bill. I am sure, and I hope, that this third draft Bill contains the most important recommendations obtained from all the sectors that commented on this Bill.

State enterprises should be subject to the same controls as private firms. There may be very good reasons why the State should take the lead in certain circumstances. However, some of the bodies have embarked into fields totally unrelated to the purpose for which they were established. They have in fact entered into fields where the competition is already great. There was therefore no need to pursue that particular field of concentration into which they moved. The Competition Board will now have jurisdiction in these matters, and that is to be welcomed in the circumstances.

The success of this legislation will depend on the attitude of the people who are going to administer it, and on the response of the business public to it There are many factors that, I believe, should be taken into account when this legislation is administered. I want to mention a few of those factors. Firstly, we should not overload business with unnecessary red tape. Secondly, it is of the utmost importance that decisions be taken which will prove to all that South Africa adheres to a free enterprise system in its economy. This is important, both to the foreign investor and to the local investor. We have always placed a high premium on foreign investments, and foreign investors have always been assured that they are dealing with a country that can meet its financial commitments to the full. They have been assured that they are dealing with a country that welcomes the fact that foreign investors can earn a high rate of return on their investments in South Africa.

Thirdly, there are the benefits of larger firms having longer production lines, therefore being able to produce at a lower price for the internal market. This also makes them more competitive on the overseas markets. Fourthly, large firms have more financial resources available, for example, in research and in making break-throughs of discovery in their particular fields. Fifthly, large firms have the opportunity of rationalizing production and distribution management, and are all in a position to employ—by virtue of their size—possibly the most expensive expertise. Sixthly, large firms can afford to provide better facilities for the training of labour. Seventhly, bigger organizations can withstand the up-turns and the down-turns of the economy. They also have access to far greater capital facilities for the expansion of their particular enterprise. Finally, bigger organizations can offer their employees greater security and stability by virtue of their size.

So one can carry on listing the advantages of big business enterprises. However, having said all this, what is of paramount importance is that all those massive firms were once small themselves, and were built up over a period of time. Therefore, the Competition Board has a special duty to ensure that the small businessman is nurtured as a very vital part of the free enterprise system. The small businessman has an important role to play and the Competition Board has to ensure that he continues to play that important role. The test in each case must be the question of what is in the public interest. However, at the same time the freedom of the private sector should not be unnecessarily hampered. I think the matter has been very clearly put by Corwin Edwards, a great American authority on competition policies. I should like to quote what he had to say on this matter—

I think that quotation by Corwin Edwards places the matter in its correct perspective. Effective competition represents an essential element of a country’s democratic way of life in that it serves to guarantee freedoms of entry and economic opportunity to every citizen.

It is in this spirit that we in the SAP will support this Bill.

Mr. Speaker, economics should be, but can only be the basis of the survival and prosperity of our own people in South Africa, as well as the people of Southern Africa, provided politics creates the right climate in which it can grow and prosper.

Because of our very special challenges in this part of the world, we cannot be just good in both economics and politics. We shall have to be uniquely brilliant and outstanding in both of these fields. In his introductory speech to the Second Reading, the hon. the Minister stated—

This, in my opinion, has the connotation of a broad spectrum.

With reference to this particular statement on “policy objectives for the country”, it is logical that the hon. the Prime Minister’s promise of a “clean administration” should come to mind; and I suggest most humbly that this ideal of a clean administration is hardly possible, under all circumstances, without also an efficient and up-to-date administration such as I motivated and appealed for during the recent budget debate. Without efficient up-to-dateness, the doors remain open for malpractices, wrong decision and wastage, economically and otherwise. My plea is that we also make up-to-dateness, efficiency, helpfulness and service-mindedness “musts” for South Africa. These should be clear-cut policy objectives, too—in the private sector, yes, but also in Government and Government-related institutions. In both sectors we have unique, outstanding examples of undertakings complying with these objectives but, as we all must admit, we also have “others”.

In this regard my further suggestion of a National Efficiency and Productivity Council fits this concept of a Competition Board like a glove. In my proposal during the budget debate I said that (Hansard, Thursday, 5 April 1979, col. 4120)—

I now suggest that the Competition Bill, as envisaged, is vital, and that the suggested Efficiency and Productivity Council is equally vital and should be a most important liaison body for the Competition Board. It should not operate under it or be placed over it. It should co-operate with it, in the broadest sense of the world, over a broad spectrum—in fact, on practically all fronts. Fair competition, highest efficiency, maximum productivity and no unfair and unjustifiable monopolistic situations are, in fact, in the practical world, all related and inter-related, and obviously fall under, and within, the framework of “other policy objectives for the country”, to use the exact words of the hon. the Minister.

And, whereas the Competition Board will be engaged in “specifics”, investigating and considering given or expected situations, the National Efficiency and Productivity Council will survey and report on the whole spectrum of our national life. To the latter aspect I shall refer a little later.

I know, of course, that the National Productivity Institute, an existing body, is doing excellent work and perhaps it could be reorganized and its activities extended to fulfil the functions which I have suggested for the National Efficiency and Productivity Council. It may be made the same body.

The National Productivity Institute recently calculated that if productivity during 1977 in the manufacturing industry alone could have been stepped up by 1%, it would have meant an increase of close to R300 million in our real domestic product. Therefore the potential is enormous.

I should furthermore like to appeal to the hon. the Minister to accentuate even more the principle that the Competition Board will not be limited to the purely or exclusively industrial, commercial, financial and allied fields. The public, business life, even the smallest trader and manufacturer in our country areas, should be made aware of the existence of this particular body.

It should also consider and review agriculture, all kinds of professions, the service industry—shipping, transport in all its forms, medicines and hospitals and all related functions; again both in the private and public sectors.

In terms of the Bill it can be done.

Yes, I realize that and that is why I have only said it should be accentuated and everybody should be made aware of it.

It should be a body where all those who are able to bring forward or to suggest reasonably, well-motivated complaints and/or ideas would be welcome. There are practically endless possibilities in the opinion of many well-meaning people, but action is often unlikely unless an outstretched hand, a guiding hand, a hand of prestige and authority would be there or could be found to publicize the guidelines and to take action. I could quote endless examples, but allow me to refer to one or two only: I am told that in the newspaper distribution field, especially as regards delivery in country areas, it is possible, through rationalization of motor transport by way of joint action, to save an enormous amount of fuel and other expense. Certainly, this should be looked upon as a nationally urgent matter, especially in the light thereof that the head of an important group at my request, estimated that the savings per annum could come to something between R20 million and R30 million—this was calculated conservatively—if only motor transport is rationalized properly. The saving could reach more than double that amount and perhaps even some 60 million to R70 million per annum if slightly slower train services would become acceptable and be used.

In a single factory of a manufacturing corporation of which I am a director an efficiency expert was called in to launch what we call an “energy conservation programme”. The effect of the launching of such a programme was that a 10% reduction in energy cost and fuel consumption was achieved in virtually no time, primarily through closing or replacing leaking faucets, other, as we call them, “screwdriver adjustments”, better optima in pressures, improved shut-down techniques, better time reading and adjustments to workloads and workflows. Others in this industry must now follow this lead and achieve the same results or they will stay behind. Again, it is a question of millions, or maybe hundreds of millions from a wider point of view, that can be saved.

Let me give another example. We are in the middle of a Health Year. What ideas are we coming forward with and implementing to promote health, which in turn will promote productivity, greater energy on the part of the various groups of employees, and fewer accidents? We find our air travellers practically falling down the steps of the aeroplanes from fatigue, having been fed on white flour sandwiches in the air. That is simply “dead food”. Perhaps, if they had drunk a glass of good South African wine and eaten a slice of wholewheat bread with ample pure, unadulterated farm butter on it, the story would have been different Added to that they could possibly have been given a vitamin mineral capsule. If they were to be given such fare, it would at the same time give the farmers and the wine industry an opportunity to promote their products. Perhaps, for publicity purposes, they will make them available free of charge to the Airways? The point I want to make is that this can become for us a unique tourist feature. I have experienced something along the same lines in a certain South American country. We had a very interesting debate on agriculture and the use of butter, and I want to ask: Who in his right mind would feed his stud animals, his pedigreed animals, his racehorses, on white flour and white sugar? What we do is to extract the “goodness” out of our food and feed it to them while we try to survive on the left-overs.

We are tougher than they are.

Nobody knows exactly how much can be done and by how much productivity can be increased through stepping-up the energy of the nation. I believe that the potential in this regard is quite considerable.

To my mind there is too great a lack of coordination and too little co-operation in our national life in South Africa. Our Railways and Airways, for example, should be harnessed in a much bigger way to promote our country and the products of our country.

To summarize, the establishment of the Competition Board is an excellent political step by the Government in the right direction. This could be an important factor in achieving higher productivity and sound economic growth provided we apply the basic principles scientifically over the entire spectrum of our natural life.

Mr. Speaker, the hon. member for Pinetown will forgive me if I do not follow him on his somewhat wide-ranging tour, a tour ranging on the one hand from people falling down the steps of aeroplanes to, on the other hand, the problems he foresees in his factory. With respect, I should like to deal with a somewhat different matter.

Sir, I regard this piece of legislation as being part of a package, one of a series we have had before us over a period of time. I believe that this package is not yet complete. I regard, for example, the Trade Practices legislation as part of the same package. I would also regard the Credit Agreements Bill, which is still to come, and matters of that sort as part of a package in order to provide protection for the consumer in what everyone here has referred to as the free enterprise society. While all the members in the House have indicated that they are in favour of free enterprise, capitalism, competition and the free-market economy, it is actually important to ask why, if in fact this is such a perfect system, this legislation is needed at all. That is why we have here a somewhat unique situation. Here we find ourselves in a legislature in which not one single member has got up and advocated the cause of socialism or was prepared to criticize the free enterprise system. In this we must be a unique legislature in the world. With the possible exception of the USA, there is no other legislature I can think of where this kind of debate could have taken place in this kind of atmosphere. Bearing that in mind, I think that to some extent we have to be a little on our guard against the situation arising that we end up all patting one another on the back and saying: “The system is fine, it is marvellous, it is going to solve all our problems”. There is no voice in the House to act as a devil’s advocate and to say: “Just a minute: Are we in fact on the right track? Are we in fact providing the right solutions?”

Guess who.

The question I want to ask the hon. the Minister, and which I think he must deal with in his reply to the debate, is whether the free enterprise system is able to fulfil the aspirations of the people of South Africa as a whole if there is not actually some form of control to prevent abuse of that system and, secondly, whether it is not necessary to adapt the free-enterprise system in such a way that there is not only opportunity, but equality of opportunity in the free-enterprise system. One of the greatest dangers of this system is perhaps that there is a concentration of power and of capital in a limited section of the community. As a result of this, envy and problems are created. The history of the world over the last 70 or 80 years is full of examples of this having happened, of the warning not having been issued and of something having had to be done to the free-enterprise system to make it survive, the alternative being that the people who are frustrated in this system would turn to another system. The biggest challenge is whether the free-enterprise system—as we see it, understand it and debate it in this House—is able to adapt to the particular circumstances that prevail in South Africa. That is the real challenge we have to face here. I want to tell the hon. the Minister that there may be a variety of reasons why people support this Bill but I, for one, would have no difficulty in voting for it because I believe that in introducing this particular measure he is endeavouring to help solve that problem. This can, in fact, be a step towards solving this particular problem that exists.

Everybody talks about economic objectives, but what is the actual economic objective that the hon. the Minister has in mind? What is the economic objective of the Government? What are the means that the Government seeks to employ in order to achieve that economic objective? I immediately want to say that although the hon. the Minister and, in fact, the commission’s report refer to the situation in other countries, the circumstances in those countries—particularly the ones he mentioned during his Second Reading speech—are almost irrelevant to our situation. The reason for this is very simple. In Yugoslavia, which he mentioned, there is a communist system, in Germany there is a socialist-democratic system and in Britain as of now—I do not know what will happen tomorrow—there is a socialist system.

What system would you like to have?

What I should like to have might be the same as what the hon. member would like to have, but if the hon. member thinks that the National Front is going to win, I am against him. To compare our situation, therefore, with this type of situation is, in my submission, an incorrect approach. Our objective, if I may put it to the hon. the Minister as I see it, is not to create a country in which some of the people are rich but the bulk of the people are poor. In South Africa we have to create a country of satisfied people, a country where there is not only opportunity, but also equality of opportunity which can really be realized. It is not a question of paying lip-service to the idea of equality. It is actually being able to say to every person that he has an opportunity of getting to the top because there is nothing to stop him from getting to the top and reaping all the benefits of the system. This means a system in which one cannot actually have a free-market mechanism operating without any limitation upon it at all, in which one cannot just have competition without any limitation upon it at all, because if one were to allow the complete free-running of the system, one would not have the real equality of opportunity which is required. One of the problems that one has in this community is, with respect, that one has consumer interests and business interests. One has small business interests and big business interests. I want to say, with respect to the hon. member for Walmer who is not now present in the House, that big is not necessarily beautiful. Far from it. I want to tell hon. members that I believe in small being beautiful, and I shall tell them why. It is so because it is the small man one has to rely on to build the State. The State consists of a multiplicity of small people and it is, in fact, the welfare of the small people that is going to help to keep the country stable. That is why it is my submission that in this kind of situation one cannot allow all these forces to operate freely without any degree of control over them at all. Free enterprise does not mean freedom to do anything one likes, the freedom to exploit, for example. In exactly the same way as the individual who enjoys freedom has to subject himself to certain rules in the interest of society, so does the businessman have to subject himself to certain rules in the interest of society. There cannot be a complete free rein, a right to do entirely what one likes.

Everybody here speaks about competition. Competition is not always the answer, because in a competitive situation it is very often the strongest, but not necessarily the best, who survive. Market forces can, in fact, try to balance the situation out, but they can also do irreparable harm in the interim, until the balance is achieved. I want to give a couple of examples of how free-market enterprise and competition in this sense can cause tremendous harm. There is undercutting which one may see in the short term as being of benefit to the consumer, but which is designed to destroy competitors. There are many examples of how undercutting takes place to destroy competitors in this very community of ours. There is undercutting in order to get a market share. There is a very recent example of a very big concern being prepared, as part of the cost of establishment, to get a market share and to undercut prices substantially so as to knock the whole market sideways for a period of time, and then, when it has established its market share, again increasing prices. Nobody can tell me that that is a legitimate operation in a free-market enterprise system. Nobody can tell me that that is a satisfactory situation. In those circumstances, should lip-service to be paid to the concept that competition is always the answer? It is all right, but only as a whole, in general terms. It certainly requires some degree of restraint, however, in the kind of situation in which we find ourselves.

Do you like competition in the Press?

Yes, I do. In case it surprises the hon. member, I want to tell him that I am opposed to a monopoly in the Press. [Interjections.] I do not think it should come as a shock to him. I do not think one can want a monopoly in everything except what may not suit one in a particular circumstance. Vice versa, one cannot argue that one must have free enterprise and then, when it does not suit one, not advocate the cause of free enterprise.

Mr. Speaker, I should like to reply to the hon. member.

No, the hon. the Minister cannot reply to me now. He may ask me a question.

Order! The hon. the Minister cannot reply now.

I shall then do that later on. I just want to put a question to him to make sure that I understand him correctly. He suggests that there should be controls, also of the Press?

No, I did not say there should be control of that. What I said was that the free-enterprise system—and the Press is not exempted in this respect—cannot be allowed to play havoc and do whatever it likes in all circumstances. In my view there is no business which is exempt from that provision. If the Press abuses a situation, and there is a monopoly in existence which is harmful to the State—and I shall come to concentration of power in a minute—one cannot uniquely put the Press aside and say that one can deal with every business in South Africa, to stop a harmful monopoly, but not with the Press.

That is all I wanted to know.

Everybody is in the same boat. I do not go along with it simply because of an ulterior motive, because of a hatred of the English Press, a hatred which is absolutely uncontrollable. [Interjections.] That is really what it is all about It is my submission—and I do not pretend that anybody has an exemption to do what he likes in South Africa; of course he does not—there are rules which apply to all enterprises, and if one establishes a monopoly and abuses a situation, it does not matter what that activity is. One cannot simply have a free licence to do what one likes.

That brings me precisely to the question of the concentration of power. I accept the concept that the concentration of power may be advantageous in certain specific circumstances. Some of them have been listed and I do not want to enlarge on them. With great respect, however, these instances are limited. The policy should not be one of a concentration of power. Concentration of power should be the exception. The concentration of power should not be accepted as a principle, merely being allowed in certain circumstances because of the needs of vast capital or because of the needs of a particular project that has to be established in the national interest. For the rest, to my mind concentrations of power are not desirable situations.

One of the tragedies of the modern age is that with the developments that have taken place there is no room for a small man in many activities. I regard that as a tragedy. Let me take the example of mining. If a prospector were to discover a valuable deposit tomorrow, he would have no hope of exploiting it on his own because he would not be able to raise the capital. It could only be done by people who have vast resources and can build up what is required. There are many examples in South Africa of the small man who has had the ingenuity or the skill, or has made a discovery, being unable to bring his plans to fulfilment because what he needs in the circumstances are vast amounts of capital.

It is quite clear that in the South African economy the expansion which is going to take place in the years that lie ahead is going to be mainly in the field of the manufacturing industry. When companies use cash, or where their shares are in demand in order to effect more and more take-overs, the danger of monopolistic situations, which adversely affect the consumer, is a very real one. To my mind the concentration of power in the manufacturing sector is one of the things that needs to be looked at because here lies the potential for very great abuses indeed. It is also my submission that in a concentration of economic power, not only in the hands of individuals, but also in the hands of a sector of the people, there are inherent political dangers. In my view we have to be very careful to avoid having a mere section of the community with the economic power concentrated in its hands, the rest of the community being frustrated at having to be faced with such a situation.

I never knew that you would ever support me.

Since he has interjected, let me say that there was another point which the hon. member for Von Brandis made about the public interest. The problem is that in terms of the Bill it is the opinion of the Minister that determines what the public interest is. Let me give a simple example. If one looks at clause 10(2) one sees that it is the Minister’s opinion that determines what the public interest is. That means, in fact, that it is a political opinion that determines what the public interest is at a particular moment of time. That is where the danger lies, because if one exercises discretion, based upon a particular political opinion of the day, one finds oneself in very, very difficult waters indeed. Let me give an example in this connection. The hon. the Minister’s opinion of what the public interest in South Africa is would be quite different, for example, from what his counterpart in Mozambique would feel is in the public interest. Opinions are therefore, in each case, motivated by the political views of a particular Minister in a particular country at a particular time.

I think you are wrong there.

That, of necessity, does not mean that that opinion expresses what is really public interest, i.e. the interest of the community as a whole. That is one of the dangers of having a discretion exercised by an individual in regard to what actually is in the public interest or the national interest, or whatever the term might be that is used at a particular time.

I should also like to refer to a few individual aspects of the Bill. One of the things that troubles me a little is that there is nothing really, with the possible exception of clause 1(x)(d)(iv) in line 42 on page 4, that relates to the question of the quality of the product. One of the things that concerns some people in this world is the question of production for obsolescence, and the agreements to produce so as to have continuing obsolescence. I wonder whether this is not an omission in the Act and whether we should not look at quality as well when we examine agreements that may be concluded which may, in fact, have an adverse effect on the economy as a whole.

Another aspect I want to refer to is the fact that an hon. member of the NRP mentioned the issue of membership of the board. I also have a particular plea in regard to that question. I should like to see somebody on that board whose qualifications go beyond those stipulated in clause 3(2) as being: “… experience in economics, industry, commerce, law or the conduct of public affairs…”. I find that the omission there is “consumer affairs and consumer interests”. I should like to see somebody on this board who is really experienced and interested in the whole concept of consumer affairs and consumer protection. That, to my mind, is an omission in this particular clause, but it can, of course, be remedied even without an amendment, depending on the nature of the appointments the hon. the Minister makes.

In the third place, an aspect that I find a little troublesome—my colleague also referred to it in passing, and we shall deal with it at length during the Committee Stage—is that there is, in terms of this Bill, some invasion of privacy which goes beyond what is necessary to fulfil the functions that have to be performed by the bodies that are created. To my mind certain rights are being created which are contrary to the general principles of the Rule of Law that we stand for, and those encroachments we should like to ask the hon. the Minister to give his consideration to, because those provisions might well spoil what is otherwise a very fine piece of legislation.

I wonder whether the hon. the Minister could perhaps, even at this stage, deal with one other problem, i.e. the question of the right of appeal as embodied in clause 15 of the Bill. I should like to know why that right of appeal has been restricted only to matters which pertain to section 14(1)(c), and I should also like to know whether he would not consider extending that right of appeal to deal with other matters that ought to be dealt with in terms of this piece of legislation.

In the last instance I should like to refer to the provisions of clause 19, and in doing so I should like to ask the hon. the Minister when he replies to the Second Reading debate, to deal with the position of the directors so that we can decide what needs to be done in this regard. As I read the Bill at the moment, the position is that whereas in the Trade Practices Act there are special provisions relating to the conduct of employees, the responsibility of directors, and matters of that nature, there are no such special provisions in this Bill. Is that done because the hon. the Minister intends that only the provisions of the Criminal Procedure Act should apply in regard to the responsibility of directors, or what has he really got in mind? I must say, with respect, that when one is dealing with mighty corporations, to whom a few hundred thousand rand may be of no consequence in relation to a particular contravention, the question is: Should there not be some penal provision which one could apply, a provision that would even make the big corporations sit up so that they would not take chances in regard to contraventions of the law? I wonder whether the hon. the Minister would respond to that in his reply to this particular debate.

I want to conclude by merely saying the following to the hon. the Minister. This Bill does, in fact, meet with our approval in the circumstances that exist As a matter of principle we believe that protection is needed for the underdog, the consumer and the small businessman. I do not believe in encouraging a concentration of wealth. I believe in opportunities for all people to work and to achieve. I believe in all those things, but the concentration of power and the encouragement of the concentration of wealth should not be the policy. What we need in South Africa are steps which are designed to close wealth-gaps, steps designed to show people that there is, in fact, opportunity, steps to show people that one can confront the free-enterprise system with a conflicting political system which is offered to the underprivileged in South Africa. If we could sell that concept we would have solved a lot of South Africa’s political problems, because South Africa’s political problems cannot be solved in isolation. In fact, the solution to South Africa’s political problems lies in solving the economic problems, meeting the existing aspirations of the people and showing them that there is opportunity for them to live in a manner which could never be afforded them in the other systems. Then one could sell the whole concept of peaceful change in South Africa. However, if one ignores the wealth-gap, the strivings and the aspirations of people in South Africa the political problems will never be solved.

Mr. Speaker, I usually have great admiration for many of the things that the hon. member for Yeoville says in these economic debates. However, with all due respect I must say that I found it very difficult to understand him today. If he is playing devil’s advocate his speech can, of course, be better understood. However, when he makes the statement that there is an overconcentration of wealth, implying that the Whites are the “haves” and the Coloured people are the “have-nots”, let me tell him that it is the kind of thing that politicians are always saying but that what he implied and all but said is, I think, nevertheless very wrong. It is a counterproductive and false statement. It is false in this sense that the hon. member for Yeoville knows that the humblest person in South Africa is deriving benefits from the Stock Exchange, pension funds and insurances in which he himself can and does invest in large measure, either directly or indirectly. He also knows…

Is that the kind of person who is investing in the Stock Exchange? What kind of rubbish is that?

… that the concentrations of wealth are not in the hands of a few people. There are not only a few people who possess wealth and the larger masses who do not. That is, however, what the hon. member was implying. It is completely false. If the hon. member were to look at the average man’s overall share in the Stock Exchange, in pension funds and other methods of investment, and therefore his share, either directly or indirectly in the wealth of the industrial capitalist system, he would see that what he has said is nonsense, but I shall come back to that.

This Bill is completely in line with the goals set by the hon. the Prime Minister when he stood on the steps of the Senate, having acceded to the premiership. I just want to quote briefly the seventh of the eight goals that he stated for South Africa that time. He said—

If we look at that statement of policy or goal the hon. the Prime Minister set for South Africa, we see that this Bill meets all the requirements he mentioned. I now quote the eighth point—

I should like to elaborate on that, also in the light of what the hon. the Minister of Economic Affairs said in his earlier speech. He said—

He went on to say—

Without regard to the main thrust of this Bill, if one looks at what the hon. the Minister had to say, when one looks at the hon. the Prime Minister’s goals, and if one also looks at what is intended with this Competition Bill and the way the board is to be constructed, in terms of clause 3 of the Bill, and when one sees that the State corporations and co-operative societies are also subject to the provisions of this legislation, then we also see that this legislation is an affirmation of the private enterprise system, and endorsement of the free enterprise system as we know it in South Africa. That, if I may say so, is something which is rare when one considers the attitudes of Governments worldwide.

For further evidence of our Government’s whole attitude towards the free enterprise system, I believe, one only has to look at the attitude of the hon. the Minister of Finance as revealed in his Second Reading speech on the Appropriation Bill this year. One can also take as evidence the attitude of the Government in respect of the promotion of home-ownership and of private property rights, something which forms the cornerstone of a free enterprise system. Then there is also the attitude revealed by the Wiehahn Commission in its report, which was tabled in Parliament yesterday. That commission also, in its report, emphasizes the paramount importance to the free enterprise system of the fullest possible utilization of our manpower in South Africa. From all this it is evident that the Government jealously guards the free enterprise economic system in South Africa.

I should like to congratulate the hon. the Minister, not only on this Bill, but also on the title of the Bill. The short title of this Bill describes very aptly what this Bill intends to achieve. I congratulate the hon. the Minister on that. That is something, I believe, we should see more often in this House. It very often happens that, especially as far as the public is concerned, the short title of a Bill is completely misleading.

The hon. the Minister often reminds us that we should think fundamentally. He has been saying that to us very frequently. For that reason I should like to deal briefly with the phenomenon of capitalism. I would prefer to define my term before I start addressing myself to the matter. For this purpose I should like to use Andrew Johnstone’s definition of capitalism. His definition reads as follows—

When we look at this Bill we are looking forward. However, it is necessary, of course, when affirming a particular system, I believe, it is good that we also look back. The hon. member for Yeoville also referred to this aspect when he said “was this the right system”, and when he asked “whether we were sure we were on the right road”.

He also raised many other potential problems he saw in our system, saying people were questioning many of those aspects. Of course, I need not remind hon. members that our system is a very young one. It is less than 200 years old. It began in England, in about 1780. In fact, it is less than 100 years old as a wide-spread system. However, in the times in which we live most of our values and institutions are to a greater or lesser extent under assault. Our economic system is no exception to that. It is also under assault, both externally and internally. Capitalism and the free market economy are presented by people who seek to destroy it as a system which is outmoded, outdated and outworn. The social reformers, in their zeal, seldom accept or understand the fact that it has been industrial capitalism that has been the goose that has laid the golden egg by which it has been made possible for wealth and welfare to be shared by all, including the underprivileged, the old, the weak and the infirm.

The hon. member for Mooi River would know far better than I do—if I am correct—that our knowledge of our economic history dates back some 4 600 years. We have a fairly good idea of what has gone on for the past 4 600 years. Industrial capitalism, however, has existed for only the last 200 years or for all practical purposes, as I have said, for the past 100 years. If one looks back at world economic history, and one projects forward in the light of the assaults that are being perpetrated on the system, one becomes concerned. I say this because until 1780 growth in the world economy was either exceptionally slow, non-existent or, more often than not, retrogressive. I do not have to remind hon. members of the three economic dark ages that have struck civilization as the wealth-making processes collapsed from time to time, almost totally extinguishing civilization or civilized living.

We saw this in the fifth century with the collapse of Imperial Rome in Europe. It took 800 years of dark, barbaric gloom before the world returned to the standards that had existed in the fifth century. Then there was another collapse in the 14th century. Then it took 400 years to get back basically to the standards that had existed in the 1300s. Each time the picture was very clear. What did one see in economic terms? One saw slow growth, a more rapid growth in population, the population outstripping the food supplies and the wealth-making processes in society and then demographic collapse. In periods of demographic collapse civilization sometimes clung to little islands like Ionia, and then from there was tenuously built out again over a long period. For those people who cannot imagine what it must have been like to have lived under those circumstances, let me point out the present-day conditions in Dacca, Karachi and Bombay where such conditions prevail.

In Africa, where one has seen accelerated economic evolution, there has been such a demographic collapse, the food-producing and wealth-producing capabilities being outstripped. In large tracts of Africa one sees bands of brigands and bandits ushering in this new dark age.

We do, of course, also have that threat right here. People talk about unemployment. Unemployment is, of course, the overhang, the first sign of possible demographic collapse, and that is so all over Africa. One sees 70% of the populations of countries like Rhodesia is under the age of 15. It is therefore a huge problem, the very problem that has almost caused the eclipse of civilization at other periods in history. It might also have happened in 1800 had it not been for the fact that industrial capitalism came upon the scene.

That is interesting because from 1800 to 1850 there was a four-fold increase in the work force. Real wages doubled from 1800 to 1850 and doubled again from 1850 to 1900. There was a 1 600% increase in production and in the consumption of wage-producing goods in England over that period. The economies of the rest of Europe, the USA and various Far Eastern countries followed. After a brief interlude between the wars, when there was mixed performance, the lift-off came again after the last war when standards increased almost throughout the world. It is important for us to look at these things because mankind, after floundering in misery and poverty, with intervening periods of barbarism, with their limited freedoms, found in industrial capitalism, for once, a formula that really worked.

Let us just take the France of 1780 as an example. In 1780 80% of the population of France spent 90% of its income on bread alone. In France today, however, there are more motor-cars per capita than in West Germany. Families in France today also have more second homes than families in any other country in Europe. If one looks at this situation, one sees what the miracle of this industrial capitalism really is. We ignore that, however. Many irresponsible things have, in my view, been said here this afternoon by the hon. member for Yeoville, for example.

These things are absolutely not conducive to a proper understanding of a system that has brought about miracles, also in this country. If we look at these facts, we will see that we will have to nurture and defend that system because it is threatened—that we know—and because it is fragile. It is not a robust system which can take any knock history can give it.

Mankind has escaped from the storage economies of antiquity. We have escaped from the slave-based economies of the Classical World. We have escaped from the agricultural feudalism in which vassals were tied to the ground. We have also escaped from the mercantilism that had to be enforced by authoritarian states.

In our own country we have seen how, with the aid of large injections of faith, our people have moved away from a dire nomadic and agricultural poverty in a stationary or static society. We will all remember that society. It was a society of “bywoners”. We had 60 such families camping on our farm. It was a time of tied cottages and poverty unknown. We moved away from the stationary or static society into a mobile or dynamic society with improved standards of living for all. In Europe the peasants were liberated along the roads that led to the factories, the mills and the farms. In South Africa that has also been the case. It is true regardless of what the hon. member for Yeoville can say about the redistribution of wealth, which is what he was actually hinting at. I think he was irresponsible in saying what he did. The fact is that the Black people of South Africa enjoy a higher standard of living than anybody else in Africa. That is, however, not the most important consideration. One must take a historical perspective and consider that a generation or two ago for he African life was brutish and short, and then compare that with the system we have now. I am not saying that the Government can take credit for that system. The fact is, however, that under this system these people have been uplifted to the stage where they enjoy a standard of living that was undreamt of before.

If one wants to know whether one is on the right road, one must not look forward, but one must look back to where one has come from. We are on the right road.

[Inaudible.]

I freely admit that we have exactly the same philosophy on this matter as the hon. members of the NRP and, if I may say so, I think South Africa can be grateful that that is so, because we must be one of the few Parliaments on earth where this situation prevails.

There is, however, something that causes me concern. In spite of the fact that people have voted with their feet for our system and have come to our factories, industrialized farms and mills in their tens of thousands, I am concerned that we might be losing the moral and intellectual battle. When I say “we”, I mean the West in general. We in South Africa cannot escape the infection. I think the hon. members for Groote Schuur, Mooi River and Simonstown will know the great library of Blackwell’s at Oxford. It is interesting that a count taken recently at the university bookshop at Oxford showed that the books advocating collectivism and Marxism outnumbered the books advocating the free enterprise system by six to one.

That is probably because they were not being sold.

That is a clever reply, but that is not the case. In fact, there is a big demand for books advocating collectivism and little demand for books advocating the free enterprise system. One must bear in mind that it was the great capitalists such as Lord Nuffield and others who gave enormous grants to seats of learning such as Oxford, that sustain this learning. It is interesting to note that some of the greatest institutions have been hijacked by the left. I refer to world institutions. Even in our country we find personnel at some of our universities preaching an anti-capitalist philosophy. That manifestation we find world-wide and it is odd because communism has failed. At best communism has been a successful parasite on industrial capitalism. It derives its technology from the Western industrial economies. In large measure it derives its capital for its large projects from the Western economies. It even derives its food from the West. Despite the fact that Russia comprises one-fifth of the world’s surface area, we find that they cannot produce enough food. Communism is an unsuccessful system which is a parasite on the successful Western society.

We must beware of this anti-capitalist mood. We must also beware of people who would preach “ecology gone mad” in order to damage the growth of our society. I say this as a conservationist and as a man who is very sympathetic towards the ecological movement. We have the ridiculous situation, for example, that the nuclear industry, which has a lower number of injuries and deaths than any other industry in the world, is singled out and attacked as being the most dangerous industry on earth.

Potentially it is.

The fact is, however, that for 10 years there were no accidents of any kind in any nuclear plant. Those which did occur were so few in number that in comparison to any other industry the nuclear industry is the safest industry in the world. Yet there is a mass ecological opinion which is damaging our whole community and system. The fact that certain ecological opinions are damaging our whole system is the reason why we find that many ecological societies have been infiltrated by Marxist movements. The Marxists realize that this is a way in which they may be able to damage the Western economies. By that I do not say that we should not preserve what it is our duty to preserve—of course we must. However, we must beware of these people.

We must beware of people who would destroy our morality and religion. It has been said that, “if one expels the priest, one does not inaugurate the age of reason, but one gets the witchdoctor”. If industrial capitalism has been the engine of our society, faith has been the fuel. We must be careful that these people do not use the freedoms which flow from the free-enterprise system to destroy the very freedom which supports them.

We must beware of trade-unionism gone mad. I welcome the Wiehahn Report. I think it is a most enlightened document and I shall support it absolutely. We must, however, avoid the kind of situation that we find in Great Britain where an assembly line produces between 20% and 50% fewer motor-cars than the same type of assembly line in West Germany because of poor trade-union legislation.

I make this point because we are often inclined to think that the kind of collapse to which I have referred cannot happen here. Although we know that it has happened, we think there will not be a recurrence, instead of realizing that it can happen again. Communism is waiting in the wings to destroy the Western, Christian civilization and to bring about a new dark age. It not only can happen: It has happened. What limited freedoms that were created in South East Asia after the Second World War are still in existence? What happened to Cambodia? Two million out of the 7 million people have died. Look what is happening in Vietnam. We can look at what is happening in the countries behind the Iron Curtain since they have been taken over one after the other. Marxism is waiting in the wings to destroy our civilization.

The legislation before us today is an endorsement of the Government’s belief in economic freedom. Of course, we are not angels, but human beings and human beings can err. There will always be people who abuse a system. The legislation is simply brought in to protect others and society against such abuse. It is a demonstration of a partnership between the public and private sectors in assisting with the formulation of policy and in arranging the economic affairs of our country.

The Bill, of course, is a refinement of and an improvement on the existing legislation, but I think its most important aspect has not been touched on directly. I think that clause 6(2) of the Bill contains its most important aspect, because there we find that the competition policy will flow from the Bill. That policy is, in fact, more important than the Bill itself. One looks forward to seeing the results of that policy and work one also looks forward with interest to the results achieved by the people who are going to do the work.

This Bill is not against market dominance—and here I find myself in accord with the hon. member for Parktown who, I think, made an excellent contribution to this debate in every respect—where market dominance is earned by “giving the proverbial lady what she wants”. The Bill is not against concentration, despite what the hon. member for Yeoville said. The Bill is not against concentration where concentration is earned by expanding trade, increasing efficiency and stable prices. This Bill is not even against the monopoly if that monopoly is in the national interest or in the interest of the consumer, as the hon. the Minister demonstrated in his Second Reading speech. If one looks at the anti-trust legislation of 1890, the Sherman Act, it is interesting to read in the Hansard of the time that Senator George Hoare, in describing the final draft of that legislation, the first of the anti-trust Acts, said that—

I think that is also the spirit of the legislation before the House today. The Bill has been introduced to afford protection against abuse flowing from actions or mergers of a monopolistic nature that take place with wrongful intent or that are damaging to business interests or the public interest. The Bill aims to retain the element of choice, competition and the health of society which flows from that competition and the myriad of choices which the public can act upon, which bring about higher standards and lower prices.

When we talk about the interests of the consumers, we must bear in mind that we are all consumers in the final analysis. Not only are we all consumers, but all of us, in consuming, become employers of industry, trade and agriculture. We must convince all our people, through economic patriotism, of the wonder of our system in which so much hope lies locked up to uplift the people of our sub-continent. Sir, there are dangers. The great eclipses of civilization that have taken place can occur again. There are signs of this everywhere in our society and nowhere do we see this more graphically than in the whole question of food, because the whole green revolution through which the burgeoning populations have been fed from the prairies has rested upon the fact that there has been a plentiful supply of cheap fossil fuel. If one looks at the latest figures from the United States, which I received yesterday, it is interesting to note that it takes 6,6 million kilocalories of fossil fuel to produce 17,9 kilocalories of maize. In other words, if one puts a third of the energy from fossil fuels into the ground, assisted by the rain and the sun one gets back twice as much again in food calories. However, these fossil fuels are no longer cheap and the American society can no longer afford to subsidize this huge industry, which in the past they subsidized at a rather low cost and which has been a useful tool in their foreign relations enabling them to make friends worldwide and to feed the world’s population. As a result of the fact that America now sits with a balance of payments problem where they are importing this energy which formerly they were producing themselves—and paying fantastic prices for these imports—they are no longer giving away food. They are now giving away foreign exchange and that is a different story entirely. Because of the recession in the Western economies, also caused by the high cost of fossil fuel, the foreign aid hand-outs are diminishing and therefore the Third World countries in turn have less money to expend—and the little money they have, they also have to expend on higher fuel prices. As a result of all this and if we have regard to the fact that each year 75 million more mouths—that is the increase of births over deaths—have to be fed and that the increase in grain production each year must be equivalent to 20 million tons, which is the entire production of the Canadian prairies, then we begin to see that we are moving in the direction of a famine. That is only being staved off by the fact that Northern Europe had a good season last year. According to the figures I received from Rome, the world supply of grain was enough for an estimated 10 days, whereas a year ago it was enough for a few months. With one bad season in the northern hemisphere 500 million people are going to start starving. We have a great role to play in Southern Africa. We are going to have to lead Southern Africa, but we are also going to have to feed Southern Africa. We will have to keep our farmers on the land. That is an important aspect in the light of the whole industrial and economic future of South Africa, because these things are totally interrelated.

Finally, I want to say that all the groups in Southern Africa can use this every-growing mutual economy and derive from it those sinews we need to defend our society and to defend those things we love in our own individual cultures.

Mr. Speaker, in speaking to this Bill, the hon. member who has just sat down has ranged far and wide. I enjoyed his speech considerably. I thought it was a very interesting speech. I want to comment on just one or two of the points he has made. He talked about the possibility of a collapse in the entire world economy. I think it is a very real possibility, because throughout history civilizations have been almost in the form of a pyramid. The Nile Valley could support a civilization of a certain height, so to speak; the pyramid could be built up to a certain height. After the expansion of this civilization, it collapsed. In Mesopotamia civilization had a broader base and the pyramid was built higher. In the Hellenic society the pyramid was built even higher. The pyramid of Rome consisted of the whole of Europe. In the present world the base of our pyramid is the entire globe. However, what is happening now in the industrialized countries of Europe, of which we are becoming one, is that the point of the pyramid is getting so far away from the base that its collapse is, as far as I can see, absolutely inevitable. The industrialized nations of the world cannot generate enough capital to be able to provide for the whole world the sort of standard of living we want to have for the Black people in our country. The question can be asked how many thousands of billions of rand it would cost to provide for the people in merely one country in Africa the self-sustaining capitalistic system which has made Europe what it is. I do not think it can be done. I agree entirely with the hon. member that the production graph for the present time is going to dip, particularly in Africa, because, as the hon. member has said, the fertilizer situation which has been brought about as a result of the rise in the oil price, is making food production impossible. However, if the population curve crosses the production graph at the point where it dips, we are heading for a historical disaster. I can see no way in which it can be avoided. I want to make the point that the essential nature of the entire effort made by the Western World lay in their work ethic. This is the difference between our society and other societies. It is the work ethic which makes people go out and do things. St Paul said: “Be not sloathful in business.” Therein lies the big difference between our society and other societies. That is what is going to make a success of our effort to take the Black people in South Africa with us into this new society. I think this is something which comes down to competition. This is precisely the essence and nature of the Bill the hon. the Minister has introduced.

The hon. member for Yeoville mentioned the fact that we do not want a country in which some of the people are rich and some of the people are poor. This related strictly to the Whites who are rich and the Blacks who are poor. What we want is a country in which some of the people are rich and some of the people are poor, but of the people there will be both Black and White who will be rich and both Black and White who will be poor, because it is impossible in any country for all the people to be rich. There is also the question of equality. It is impossible for everybody in a country to be equal. There must be leaders and there must be followers. The Bill which the hon. the Minister is introducing is trying to create a climate which is fair to everybody, so that everybody can have a go and there shall not be undue concentrations of power or wealth in the hands of some of the groups, which gives them an unfair advantage, thereby creating the sort of condition we are all talking about, a revolutionary condition which might upset the system to which we belong.

The hon. member for Newcastle spoke about the ugly face of capitalism. Capitalism has been under assault for more than 100 years. 100 years ago Karl Marx was still alive and Friedrich Engels was still writing. He was then moving into the position of godfather of the whole German social-democratic movement. Capitalism has been under continuous assault ever since then and the assault became more and more violent until the Russian/communist revolution turned armed force loose upon the capitalist world.

There is nothing wrong with capitalism.

The hon. the Minister says that there is nothing wrong with capitalism. That is exactly what I was saying. I am so pleased that he agrees with me.

It is a sweeping statement.

The Creator gave one man five talents and another man two.

That is right. I think the hon. the Minister must, however, study his Bible again. It was actually the Lord who gave these talents when he departed on a journey, but I shall not continue with the story because I am sure that you, Mr. Speaker, have a better knowledge of the story than the hon. Minister of Agriculture.

The question is: What was the interest rate?

That is right. One buried his talent in the ground and it did not grow. The point that I want to make is that capitalism in the present world in which we live has acquired a very benign form. I think it is very important that we realize that capitalism has become institutionalized. What has happened is that big organizations, pension funds, life insurance companies, etc., have taken the sting out of capitalism, the old, raw, ruthless capitalism that we had 100 years ago, in which people like Joe Gool, the Rockefellers of the United States and others, built up enormous fortunes at the expense of every other person living in the country. They were ruthless robber barons and they were proud of the fact and of that title. I think that that sort of capitalism has in our country and in our society, and in the Western society as a whole, passed out of existence and is no longer possible. It has passed out of existence because of the power of organizations is in the hands of the common people through the process of democracy. That is what is important It is the people getting together who have tamed this ruthless force, and have, at the same time, allowed it to maintain the creative principle which has made our society what it is. The absolute essence of everything we do is competition, because it is competition which brings prices down and it is competition which creates efficiency and demands efficiency. I think that that is something we have to protect in the situation in which we live.

I wish to raise a particular problem with the hon. the Minister. I have been speaking in this House for some years precisely on the need for us to turn around from the drift towards socialism that I think we were embarked on, to what I regard as being a reemphasis of the values of the free-enterprise system. I want to make a particular point, as I have before, of the part played by the State in the present business situation in South Africa. I have pleaded before for a spin-off out of the hands of the State of many of the companies which are owned by the State and operated through various development corporations, etc. I think it would be possible, if those were sold on the market, to recover a great amount of capital which could be devoted to purposes such as Sasol 2, etc. I think the hon. the Minister might well find that he would have more capital at his disposal if he were able to do so. However, I have always had a problem with this and, as a result, I have never pushed the matter very far. If one spins off companies and groups of companies out of the hands of the State, where do they end up? This is one of the problems I have. Our country today consists of either the big State or very big corporations.

That is one of the essential problems with which we have to deal.

That is precisely why I am supporting the Bill. I think we are now at last reaching the situation where the ideal, which I should like to see happening, might become possible. If one is going to spin off successful companies from the control of one or other of the organizations of the State, and they are then snapped up by other big co-operations which merely get bigger and bigger, I think one is defeating the object the hon. the Minister is trying to achieve. It seems that we have a problem in this regard, and I wonder if the hon. the Minister could perhaps give us some answer in this respect. If one is going to do that, somebody will have to buy the companies. If this board is going to investigate the State and the agencies of the State, make recommendations, separate this from that and create arms-length relationships, etc., where will the capital come from to acquire the assets and the shares in the companies, etc.?

The new principle embodied in this Bill is to take preventative action so that such a situation will not be allowed to arise.

That is the point. The hon. the Minister is now looking at the situation in retrospect These things have happened, but what I am saying is that it might happen in the future in that the board might look at some of the organizations under the control of his department or elsewhere and advise them to divest themselves of the control of a certain aspects and place them under some other kind of control. In the light of this responsibility, I should like to ask the hon. the Minister whether there are any ideas at all about where the capital is to come from for the acquisition of that sort of thing, short of these assets going into the hands of the big corporations, a situation I should regard as being undesirable.

From my point of view a monopoly by an over-large corporation is a frustration of the whole free-enterprise system, especially from the point of view that there are over-concentrations of capital and managerial talent. This is one of the problems I have in this regard. One finds that active and able people move into organizations, but after they have attained a certain level of promotion, they find themselves waiting for dead men’s shoes. That is why one finds people who are not only frustrated, but who are also not producing their best because of the structure of big conglomerates, or whatever one wishes to call them. In my opinion over-concentration reduces the real thrust that this country of ours ought to be getting at present.

I think that the Bill will give the board a chance to look at the situation, and I should like the hon. the Minister to give us perhaps a little more detail about how he thinks it can work. There is obviously going to have to be some destructuring if it is going to work in retrospect. I should like to know from the hon. the Minister whether it will work in retrospect, and whether there will have to be a destructuring of some of the organizations that have been put together in the recent past. I await an answer from the hon. the Minister, because he will have to say “yea” or “nay” to that. I can see that in future any applications or suggestions of mergers, etc., would have to go through the board and that the board would have to give its approval or withhold it. They would perhaps also have to institute proceedings to find out whether these things are desirable or not, and I think that is very valuable.

There are so many things in our country that can be affected by this. The question of armaments, for example, is obviously a sensitive issue, a strategic matter, and if the State has it in his hands and wants to keep it in its hands, one can quite understand that. One would like to think, however, that in such a situation private enterprise would be encouraged to move in and take over the responsibility, provided the companies that move in are completely under South African control and will remain so.

Is that what worries you?

Yes.

Well, you need not be worried about it.

I am glad to hear that.

The hon. the Minister also referred to the per se principle, and I think that this measure lends itself to a great deal of flexibility. I am very glad indeed that this is the case, because it means that the board can investigate a matter ad hoc, and I think the whole purpose of establishing such a board is that it must be able to take ad hoc decisions, without having to adhere to principles that bind every single transaction that may be negotiated or applied for. I think that is a very important factor indeed. I hope that what we shall essentially achieve through this board will be a balance. Our real objection must, after all, be to achieve a balance between the activities of the State, which are essential in certain aspects, and the activities of the private enterprise system, and I should like to see the activities of the private enterprise system taking place in smaller groups rather than in the larger ones we have seen emerging lately. If the Bill is therefore going to bring this about—and I believe it will—I shall be very pleased, and I therefore support it on that basis.

Mr. Speaker, I should like to thank the hon. member for Mooi River for his contribution, particularly because he expressed his support of this Bill. By doing so he endorsed free enterprise, the free market mechanism and the extension of the basis of our business life in particular. I should also like to express my gratitude to the hon. member for Maitland, for his contribution. He gave us a very thorough exposition of the historic background of our system, as well as its good characteristics. I think it is perhaps very appropriate in this regard to refer to a quote by the author Emerson. I quote—

I want to suggest that at this stage by means of the Bill we are dealing with the “wit”, to make this system of ours as productive as possible.

I support the capitalistic system, because I believe that, where there is private ownership of the means of production and when there is a freedom of private enterprise to apply these means of production in the economy, this will result in the greatest benefit for the community as a whole. In his book The Wealth of Nations Adam Smith spoke of an “invisible hand” which would allow free enterprise to operate to the greatest benefit of the whole community. This “invisible hand” is indeed the free market system, and this system ensures the greatest benefit for the whole community by way of competition. However, in order to be balanced and to be of greatest benefit to the community and to ensure that there is full competition, the parties concerned with the market’s power of negotiation must not be so disproportionate that the weaker parties are exploited by the stronger parties. Prof. Lombard states very clearly in his book Freedom, Welfare and Order that—

I should like to emphasize the “combination of participants”. The number of participants in the market is not what matters here, what matters is that the number of participants should be independent of one another. What is the point if there are a number of participants who are working together in the market on a co-ordinated basis? The theoretical requirements for a complete market mechanism are threefold. Firstly, there must be a permanent restriction on the size of each firm in the market, so that its share in the total market is relatively small, thereby ensuring that one enterprise cannot exploit another. Secondly, the various enterprises may not be allowed to collude. Furthermore it must be ensured that products being produced by the various enterprises, are completely replaceable and interchangeable so that one firm cannot produce a better product than the other and is in this way placed in a stronger position. It requires no argument to indicate that the situation of a completely free market mechanism can never be achieved. The reason for this is that there is an uneven distribution of wealth and that freedom of enterprise exists in the economy. Consequently one entrepreneur will of necessity be stronger and be able to exercise more power than another.

Private enterprise and the profit motive, which have always been the driving force of capitalism, are also the factors which deprive the free market system of its perfect competition. For example, they cause firms to work together to reduce competition and in this way to increase their prices. Moreover, they cause a differentiation of products and an excess of advertisements so that product preferences arise and competition is once again undermined. For that reason the free market system must be protected against the possibility of its momentum being reduced by that which drives it on. These factors cause industrial development to be characterized by a growing tendency for the creation of ever larger entrepreneurs on the one hand, and ever great concentrations and integration on the other.

Now I want to concede at once that the formation of large enterprises are not wrong per se. This could present many advantages. For example, doors are opened for cheap production owing to capital-intensive production processes. But the same cannot be said for the forming of cartels. Almost without exception it aims at ensuring profits by eliminating market forces. This is done by way of agreements by which prices, markets for certain enterprises and production quotas are fixed.

The same also applies in the case of horizontal integration, of which we have had several examples in our country over the most recent years. The only motive for the forming of horizontal integration is the elimination of competition. This ensures profits and also increases profits.

J. M. Clarke declared as far back as 1932 that—

As I have already indicated, complete free market competition is impossible, because there are and always will be so many unequal participants in our economy. In order to ensure that our economic system is as productive as possible, however, we shall have to ensure that there is as much real competition as possible in the market, that there is economic freedom for the so-called competition, and that every action on the part of the private sector to wreck this, be opposed in the strongest way. I wish to refer to what Dr. Ludwig Ehrhardt wrote in his book Prosperity through Competition. He refers here to the tremendous economic miracles which took place in Germany—

I believe that this Bill creates a great opportunity to ensure economic growth. This legislation is aimed at ensuring, with the least possible disruption to the economy, that there are sufficient independent economic participants in the market to ensure in this way that the country’s economy is operated to the greatest common benefit.

Mr. Speaker, the hon. member for Pietermaritzburg North stated his case in connection with the free market system and economic freedoms very clearly. At a later stage in my speech I too shall deal with it in more detail.

The Bill before us is not an anti-competition Bill. It is intended to regulate competition. Monopolistic institutions can also be healthy; for example, if a number of small firms combine in order to improve distribution and force prices down. Then it is a good combination serving a good purpose. Only when monopolistic conditions or institutions are damaging to the society or community should they be examined. In a country of wide expanses such as South Africa, a young country as far as industries are concerned, a country with a small population in comparison with other industrial countries, we still have to make a great deal of progress in the industrial field in comparison with them. Just such a situation is fertile ground for the rise of monopolies which could be prejudicial to the community. For that reason it is our and the Government’s duty to ensure, by way of this type of legislation, that healthy competition can always take place.

If we investigate the history of the forming of monopolies, we find that its chief motive is, in fact, that of security and stability. In this way the entrepreneur wishes to safeguard his own interests, because if one regards oneself as great and powerful, if one can work one’s way up to a position of dominance, it satisfies not only one’s ambition and lust for power, but also one’s striving to feel more secure. In the process, however, you work against your opponents. This, then, is the wrong aspect of this system of monopolies whereby the security of others is jeopardized for the sake of one’s own safety. For the sake of one’s own existence the survival of others is destroyed.

Economic life is built on the principles of competition, rivalry and risk, and as soon as one removes the elements of rivalry and risk from the system, the economic system is destroyed. It is out of the principle of free economy, economic freedom and private initiative, that monopolies often arise. The danger is, of course, that once they have arisen out of the freedom of the economy, they tend to destroy the very freedom which gave rise to them.

There is also the danger that a monopolistic pressure group could form which could exert pressure on the Government. By forming monopolies, strong pressure can be exerted on the State. Because they then have such great economic power in their hands, they can hinder or oppose the development of the country. They can also contribute to bringing about prosperity or adversity in the economy. When great monopolies unite and use their resources to provide work, they can bring about a situation of deflation, but they can also create a situation of inflation. It is also true that great monopolies always try to get the Press or other media to exercise influence in favour of their cause. In that way they try to win public opinion to their side. In this way we get a State within a State, and this is, of course, in conflict with democracy. This is, of course, more dangerous than any open political power, because it is political power behind the scenes with no political responsibility. This could cause monopolies to come into conflict with the State and public opinion. It is also true that when such a great monopoly falls, it can have serious consequences for the welfare of the community as a whole. For that reason the dangers of monopoly-forming for the economic sphere should be guarded against. As far as South Africa is concerned, we should keep an eye on this and ensure that these harmful trends do not develop here.

If we examine the historic course of economic growth in South Africa, we find that it took place in three phases. From the time of the original settlement in 1652 up to 1870, agriculture was the dominant industry in South Africa. From 1870 to 1909s to just before becoming a Union, mining, together with agriculture, played the most important part in this country. Since becoming a Union in 1910 a new era has dawned in our country’s economic history. By becoming a Union the four provinces were united in a political unity under control of a central Government. This led to better and uniform administration, which in turn was responsible for the establishment of the necessary infrastructure, particularly in respect of the improvement of transportation and harbour facilities. The period after the First World War emphasized the necessity of having our own industry. In 1925, legislation was introduced to protect local industries against foreign competition. The establishment of our own iron and steel industry in 1928 was one of the cornerstones of the development of the South African economy.

The Second World War made heavy demands on the South African industries and gave industrial development in South Africa a tremendous boost.

In comparison with the standards of foreign industrial countries, South Africa’s industrial sector is relatively small. The reason for this is that the relatively small local market, consisting of approximately 26 million people, as well as the vastness of our country, contribute to fragmentation of the market. The scarcity of capital, technical skill and manpower can also be added to this. In addition the export market has not yet developed to such an extent that it can make a major contribution to our economic development Furthermore it should be borne in mind that a large percentage of the 26 million people in South Africa are low-paid people. This could give rise to the forming of large firms that operate on a concentrated and often integrated basis. The size of a firm is also influenced by the monopolistic trends in the demand section of the market. It is a well-known fact that a large part of the country’s manufactured or semi-manufactured products are marketed to a few large buyers, for example the mines, the motor industry, engineering firms, the central Government, departments, provincial administrations, State corporations and chain stores. It is very difficult for small firms to meet the mass demand, quality control and guarantees required by the buyers.

If the mining industry is examined, it will be seen that it is almost impossible for one small organization or one small group to extract minerals from a mine, owing to the capital required and the risk and technical skills involved. That is why it happened in the past that the smaller mining groups amalgamated in order to overcome that problem. Furthermore these mining groups often became involved in financing and secondary industries. Consequently these mining houses have today become powerful financial institutions in our country’s economy.

It is important to pursue the free enterprise system in our industrial sector. We should take care that all forms of competition are not eliminated by take-overs or group-forming. The advantages and disadvantages of takeover and group-forming have to be controlled so that they will always be in the interests of the community. This is the crux of this Bill.

I should like to repeat that not all takeovers and group-forming should be opposed, but that a watchful eye should be kept in order to ensure that they will always be to the advantage and not the disadvantage of the economy, the Government and the community.

I do not want to go into the technical aspects of this Bill any further, except to point out that this Bill also subjects Government institutions and enterprises to the same monopolistic control to which firms in the private sector are to be subjected.

Under certain circumstances it is essential that the Government play the part of entrepreneur. The hon. member for Newcastle explained that aspect earlier today in this debate. I have already pointed out that the South African economy, with its limited market, is relatively very small and experiences problems with regard to distances and transport. For this reason it is necessary that the State play the part of entrepreneur in certain sectors. Indeed this is also the responsibility of the State. The State has a responsibility with regard to strategy and the security of this country. In this regard it has to play its part. If we examine the 1979 budget we see that it is a stimulant for economic growth, in the private sector in particular. This shows that the Government is geared to the promotion of private enterprises and growth. This Bill is aimed at adapting the Regulation of Monopolistic Conditions Act of 1955 to the changed economic conditions which have set in over the past 24 years. If one bears in mind that this Bill is the first amendment being effected, one sees how effective the legislation has been since 1955.

In June 1975 the Mouton Commission was appointed and directed to institute an investigation into and report on, firstly, the trend towards forming economic power concentrations by amalgamation or takeovers; secondly, the advantages or disadvantages involved in such economic power concentrations from the point of view of the community’s interests; and thirdly, the effectiveness of the Monopolistic Conditions Act of 1955 as an instrument to ensure competition and promote the national economy. The commission was also directed to make recommendations which would be necessary to eliminate, control and regulate economic power concentrations. The hon. the Minister explained in his Second Reading speech that when the draft legislation was submitted for the first time, commentary was received on it and that draft legislation was then drafted for the second time and submitted for commentary. Therefore, the public and the private sector had sufficient time to study the draft legislation. Indeed, they supported it. Favourable comment concerning the legislation has already been made. The principle of the regulations of monopolistic conditions is not a new principle in South Africa. As far back as 1907 the Cape Meat Trades Act was passed, which provided, inter alia, that any contract or conspiracy to impose an unreasonable prohibition or restriction on a butcher, was illegal. In 1911 the Post Office Administration and Shipping Combination Discouragement Act was passed, which prohibited the Government from negotiating any contract with any shipping agents which would prejudice the Department of Commerce and Industry. At present this Act is still being administered by the Department of Posts and Telecommunications. In 1916 the Patents, Designs, Trademarks and Copyrights Act was passed which made the licensing of patents compulsory, if the reasonable requirements of the public with regard to the patented invention were not met In 1920 the Profiteering Act was passed and in 1924 the Board of Trade and Industries Act.

I believe that prevention is better than cure, and for that reason I take pleasure in supporting this Bill.

Mr. Speaker, the hon. member for Alberton made a very useful and interesting contribution by outlining to this House the history of this legislation relating to monopolistic conditions. But the hon. member must pardon me for not going to attempt to improve on it The hon. member for Pietermaritzburg North referred to an article by the eminent Dr. Ehrhardt, and if I jotted it down correctly, he said more or less the following—

I think I have more or less quoted him correctly.

† believe that this is a lesson for all to learn and does bear a close relationship to the topic which we are discussing here this evening. I believe—and I shall come back to this in a moment—that we have to bear in mind that the building of a free economic society, the creation of an economic miracle in South Africa—because we need nothing less than that—will, as in Germany, require the participation of all men in a free economic and competitive system. I believe this is something which this legislation may in fact encourage and assist in developing. I shall return to this particular topic at a later stage of my speech. I believe the success of this legislation, legislation which we on this side of the House strongly endorse, depends not so much on its actual provisions. These are, by and large, unexceptional. The legislation as it stands is in fact extremely well-compiled legislation and while we shall no doubt be looking closely at some of the provisions in the Committee Stage, I think that one’s reservations would not relate so much to the structure of the legislation itself as to the success the hon. the Minister will have in carrying out his intentions in regard to the object of the legislation. The hon. the Minister has made it very clear in his introductory speech and also by the interjections that he has made in the course of this debate so far, that he is very determined to achieve the objectives, which I think are well-described and well-defined in the report of the Mouton Commission, and also to achieve the broader objective of creating an economic society which will not be hampered and obstructed by conditions of a harmful monopolistic nature. The hon. the Minister’s intentions have been made entirely clear although they may be difficult to achieve in the light of the kind of obstacles he is likely to encounter.

Mr. Speaker, in view of the lateness of the hour and perhaps to meet the convenience of the House, I now move—

Agreed to.

Business suspended at 18h30 and resumed at 20h00.

Mr. Speaker, I move—

Mr. Speaker, the debate on the Liquor Bill has so far been a very interesting debate and it has now reached the final stage. I want to make use of this opportunity to try to persuade the hon. the Minister that it is not too late for him to withdraw the Bill and proceed with it no further. [Interjections.] What I find most difficult to understand, is the morality of that side of the House in relation to this matter. This Bill is really out of character with the morality of the NP. Yesterday we asked their support for a State lottery, and the hon. the Minister of Health said that they could not support such a project. While they do not see their way clear to supporting a State lottery, they are able to support the extension of liquor outlets. The question I want to put in this regard is: Who is really going to benefit by the extending of liquor outlets? It will be only those who have a financial interest in the liquor trade, those who see it as their bounden duty to blow up their profits for their own benefit and for the benefit of their shareholders. It will be only those people who have vested interests in this trade who will benefit, and no one else. In the light of this I want to know whether we can afford to proceed with a measure of this nature when it is really, I submit and I think hon. members must know, out of character with the morality of the NP. Although they have said that it is an open matter, I find it absolutely remarkable that in the entire debate not one speaker on that side of the House—and a good number of them took part—got up and spoke against the Bill. I must say that we had a most remarkable situation when the hon. member for Innesdal spoke yesterday.

*I should like to congratulate the hon. member for Innesdal on the excellent speech he made yesterday. Now, however, I want to appeal to the hon. member to vote with us against the Third Reading of this Bill. When we call for a division, he must not leave the Chamber, because I want him to vote with this side of the House, since it is evident that he is of the same mind as us. On that, too, I want to congratulate him. Let us look at what the hon. member said in this regard—

The hon. member went on to say—

This certainly is the opinion of many hon. members opposite, and I want them to stand up tonight and defend the morality of their view.

†We are dealing with wine tonight, and I should like to say that we are not against drink in principle. I do not think anybody will be silly enough to try to advocate in South Africa, or anywhere else in the world, and particularly in the Western World, that one should abstain completely from drink or that there must be total prohibition. I think this would be a futile and meaningless exercise. We have to concern ourselves here with the fact that liquor is going to be made more readily available. Availability of a product entices people to partake of it, whether it be cigarettes, dagga, liquor or something else. The whole advertising world is geared to bringing products to the attention of the public, to selling those products. That is what advertising is all about Liquor will be advertised and it will be available at more outlets and thus more people will be enticed to partake of liquor. Since wine has an alcoholic content, one will thus slowly build and extend a base for alcoholism and…

The same point that you are making. [Interjections.]

Order!

Mr. Speaker, may I ask the hon. member a question? When he and I were in Johannesburg, I raised this point which he is now making. The hon. member was opposed to it. I now want to ascertain from the hon. member why he is now expressing the matter differently to the way he expressed it when he was still serving on the executive committee of the Johannesburg City Council. [Interjections.]

I can easily give the hon. member a reply to that question. I never supported this principle and I never voted in favour of it.

You supported the advertisements?

Advertisements? No! [Interjections.] I was personally opposed to liquor advertisements. [Interjections.] The hon. member, and other members of the NP, will agree with the point I want to make.

†Let me come back to the question of advertising. Liquor is going to become more easily accessible when it is made available in supermarkets or grocery stores. One has it put in front of one and this leads to auto-suggestion. Through all these factors, i.e. availability, advertising, easy access and autosuggestion, the public is induced to partake, induced to purchase.

Liquor is going to be available in residential areas. The question was raised by the hon. member for Yeoville and the hon. the Minister also made the point that it is not always easy to define what is a residential area. However, with great respect—and the hon. member for Langlaagte will be able to help me here, too—from the town planning point of view, when a local authority draws up a town planning scheme, it decides on what areas are to be residential areas, commercial areas and industrial areas.

We are not talking now about town planning.

I concede that. However, most towns in their town planning schemes indicate which areas are the residential areas. I am complaining about Hillbrow—I make no bones about it. I am bitterly opposed to any extension of liquor outlets in Hillbrow as well as in other areas.

Hon. members know that the Liquor Board is very circumspect and does not easily grant licences for liquor stores. There is a formula laid down with regard to the number of voters in an area, etc. What is the position in areas like Pinelands? The hon. member for Pinelands can perhaps make the point better than I can. He has a difficulty in Pineland such as I have in respect of an area like Sedgefield. The hon. the Prime Minister and the hon. the Minister of Economic Affairs know Sedgefield in the Knysna area. In both those areas applications were received for licences for liquor outlets. The local inhabitants were so opposed to the idea, however, that they held a mass meeting at which a resolution was carried that their objections were to be conveyed directly to the Liquor Licensing Board. Ultimately the board was persuaded not to grant those applications for liquor licences. Although people in that area can still obtain wine by travelling a mile or two, the fact remains that they do not congregate on street comers and pavements in areas such as Pinelands, and the peace there is not being disturbed. There are many other urban areas and suburbs in which the situation is the same as in Pinelands. However, what are we doing now? By making it possible for wine to be distributed by grocery shops and supermarkets we are actually opening a back door, as it were, through which wine can be distributed, thus defeating the very object of all the valid restrictions that have existed until now. I would urge the hon. the Minister to give very serious consideration to this.

Then, of course, there is also the question of young people. We are trying everything possible to dissuade young people from smoking and using drugs. Meanwhile, we seem to forget that liquor is also a drug. The important thing is that young people should be educated. Only through education can they really come to realize what is actually involved. Only yesterday the hon. the Minister of Health made a very, very important announcement in connection with smoking. He clearly accepted the principle of a special education programme geared at bringing home to the youth of South Africa the health hazards of the smoking habit. That very same principle also applies in the case now under discussion. Instead of doing just that, however, we are now deliberately exposing the very young to the dangers of alcohol abuse. We now make it possible for them to walk into any supermarket or grocery store, there to be exposed to the temptation of wine of many varieties prominently displayed together with the other merchandise offered for sale.

I want to know from the hon. the Minister how this whole scheme is going to be put into effect? What requirements will supermarkets and grocery stores have to meet once a contract has been concluded with a bottle store or hotel off-sales for the establishment of a wine counter on their premises? Will a separate counter be used for this purpose? Will it have to be partitioned off so that it can be closed while the rest of the shopping area remains open? What are the requirements going to be?

Did you not read the Wiehahn Commission’s report?

Yes, but what has that report to do with this?

The liberalization of the laws.

Well, Mr. Speaker, the hon. member for Durban North seems to need another glass of wine. [Interjections.] Then, of course, there is also the question of security. Will wine counters in supermarkets and grocery stores in any way be limited with regard to the quantities of wine they will be able to stock? Will they have to stock a minimum variety of brands of wine? Will they have to comply with exactly the same conditions that are imposed on bottle stores?

Quite frankly, Mr. Speaker, it is my conviction that we have quite enough liquor outlets in the Western Cape, in the Cape Peninsula and throughout the whole of South Africa. In order to make wine available to those who want to obtain it, it is definitely not necessary for us to expose young children, the youth of South Africa, in such a wanton way to the added dangers of the freer availability of liquor. I should like to remind the hon. the Minister, if I may, of the fact that the per capita consumption of wine is already on the increase and that it has been proved that when the per capita consumption rises the trend is invariably towards heavier drinking all round. In this instance my authority is the Journal of Study of Alcohol, Vol. 39, of August 1978. The survey published here was done by experts Cartwright, Shaw and Spratsky. They clearly indicate that this particular problem has in fact increased. What we must also not forget is that every alcoholic loses, on average, something like 22 working days a year. The cost to South Africa in wages alone is approximately R200 million a year.

Then there is also the question of industrial accidents. It is a known fact that alcohol abuse is a major cause of industrial accidents. During 1978 alone there were 354 280 industrial accidents in South Africa, costing the country the staggering amount of R33,7 million. According to experts, 25% of this amount can be attributed to accidents in which alcohol played a major role.

What we are going to do now seems rather strange in the light of what used to happen in the old days when all the applications for liquor licences came before the Liquor Court on the first Monday of November. Bodies like the Temperance Society and the Salvation Army, as well as hundreds of individuals, used to attend the sittings of the Liquor Court, making representations and stating their problems and objections in connection with various aspects, such as the effect of liquor on young people, the breaking up of families as a result of alcohol abuse and many other similar problems related to alcohol. They were given a fair hearing and the court used to listen with interest to what each and every one of them had to say before any decision was taken in connection with the granting of applications for licences.

Have we reached such a stage in our society that we can still turn a deaf ear and a blind eye to all these problems which are costing us money? The Department of Social Welfare is obliged to set enormous sums of money aside to pay for, inter alia, the alcohol crisis clinics which have to be established and maintained, and the social welfare workers who are involved in these problems. Let us be realistic without going overboard. We should not allow temptations by encouraging this and making liquor more readily available. We should not expose our children to such temptation. My final plea to the hon. the Minister and to hon. members on that side of the House is therefore that they should follow the morals and the advice of the hon. member for Innesdal. They should stand with him and with us against the Third Reading.

Mr. Speaker, the hon. member for Hillbrow was probably joking when he said that the hon. the Minister should not carry on with the legislation. There are surely many hon. members on his side of the House who are in favour of the Bill and who want it to be continued with. The hon. member for Innesdal will put his standpoint in a moment because we on this side of the House are also free to express our opinions on liquor legislation. [Interjections.] It is true that a few hon. members did not take part in divisions. They did not want to vote against the Bill because they did not object to it to such an extent that they found it necessary to vote against the Bill. The hon. member for Innesdal is one of the hon. members on our side who is not in favour of a freer distribution of liquor and, as I said, he will state his standpoint. I do not know why hon. members opposite try to make so much capital out of this argument which in fact is no argument at all. In the course of my speech I shall deal with a few of the other arguments advanced by the hon. member for Hillbrow.

I now wish to dwell on clause 2, which, in my opinion, is one of the most important clauses in the Bill. Clause 2 envisages the repeal of section 30 of the principal Act containing the 30% provision. The repeal of section 30 is in essence linked to clause 8 of the Bill. One must see the repeal of the 30% provision in the light of the fact that there must not be discrimination against the south. We know that up to this year, 56 grocer’s wine licences have already been granted of which 53 have been granted in the Transvaal and Natal and only three in the Cape.

This state of affairs arose out of the difference between the drinking patterns of the White and Brown people on the one hand and between the White and Black people on the other. As far as wine is concerned we know that the Brown man in the Cape drinks more wine than spirits or beer. The fact that the Brown man prefers wine resulted in the sale of wine in the Western Cape increasing but I feel that it is wrong that the Whites should be penalized by section 30 which results in fewer grocers’ wine licences being granted in the Cape. The White person in the Cape also wants the privilege enjoyed by the White in the Transvaal of being able to purchase wine in grocers’ stores. The Brown man’s preference for wine causes the drinking pattern in the Cape to be different to that elsewhere in the country. I do not begrudge it to him, but the result is that the Whites in the Cape who prefer wine are penalized. The envisaged amendment of the Liquor Act in fact concerns a freer distribution of liquor. There are various standpoints in this regard and this is the case in this House as well. One has respect for the various standpoints, of course, but one also has to see this in the light of the fact that as far as the freer distribution of wine is concerned, grocers’ wine licences already exist. It is nothing new. The only new aspect being introduced here is that holders of liquor store licences and hotel liquor licences are now also being permitted to obtain a grocer’s wine licence. Section 150 of the Liquor Act regulates the hours of sale of liquor. The hours of sale in grocer’s stores will be the same as for liquor store licences, namely from 09h00 to 18h30 on weekdays and from 09h00 to 13h00 on Saturdays. Therefore no change is being effected to the hours of sale. However, it must also be borne in mind that in the whole process of awarding grocers’ liquor licences the Liquor Board will always be there to keep an eye on matters. Liquor licences will not be granted freely but with discretion and sound judgment. If liquor licences were granted right, left and centre it can be accepted that by this time hundreds of such licences would have been issued in the Transvaal, the Free State and Natal. This goes to show that discretion is exercised in the granting of these licences. What is very important, and what people sometimes fail to bear in mind when reading the Bill, is that it only concerns natural wines. Spirits and other types of wine are not at issue here.

When one thinks about liquor distribution, one necessarily thinks about monopolistic conditions. The very fact that natural wines are now to be sold in grocers’ stores is going to counteract the creation of monopolistic conditions because there is now going to be freer distribution. It must be borne in mind that our Liquor Act has existed since 1928 and it is necessary to adjust and improve it as time goes by in order to adapt it to changing circumstances. The limitations that at present apply to liquor sales and liquor distributions will remain. There are a number of limitations. The liquor industry is only really a supporting industry for other industries. The hours of sale have a limiting effect on liquor sales, as do closed days. The facilities for the sale of liquor also have a limiting effect because there are always minimum requirements to be complied with. Then, too, there is the sex and age of people, which have a limiting effect on liquor sales. Then there is the restriction of the granting of liquor licences. Liquor licences are not easily obtainable like general dealers’ licences and other types of licences. It may be seen, therefore, that liquor abuse, about which so much has been said, is being constantly guarded against. The sale of natural wine in grocers’ stores entails major advantages for the wine farmer because the restrictions are being lifted a little. This partial withdrawal of these restrictions in favour of the wine farmers is to be welcomed. Last week we heard that the farmers in South Africa were having a hard time of it due to rising production costs and so on. The time is going to come when the wine farmer, too, is going to be hard pressed and this is something that needs to be looked at now before the wine farmers, too, are eventually unable to make ends meet. Matters must be made easier for them so that it is a more paying proposition for them to produce. We in this country are in fact very proud of our wine industry. Those who have dropped in on a liquor store selling our natural wines overseas, in London in particular, have soon realized that South Africa has reason to be proud of its wines. Why should people in Europe and other overseas countries be able to buy our wines freely whereas we in South Africa are unable to buy our quality product, our pride, freely? I therefore think that if one takes everything into account and considers it soberly, this Bill is very welcome because it makes provision for wine to be available in grocers’ stores in the Western Cape as is the case at present in Transvaal and Natal.

Mr. Speaker, the hon. member who has just addressed the House adopted a consistent attitude in indicating that he intends supporting the Third Reading of this amending legislation. I also intend adopting a consistent attitude by voting against the Third Reading of this Bill.

I think that, if one looks through the various Hansards at the debate in history on various amendments to the Liquor Act, one will find that, almost without exception, those amendments have always been in the form of concessions to make liquor more easily and more readily available. I cannot remember any occasion when the amendment has been of a restrictive nature. In the same way this Bill, which is in its Third Reading stage, is a piece of legislation which will make it possible for the Liquor Board to grant grocers’ wine licences, particularly here in the South Western Cape, with the abolition of the 30% restriction through the repeal of section 30 of the Liquor Act. It will also mean that people who hold liquor off-sales licences will be able to establish wine counters in various supermarkets. On each occasion there have been extensions. In this particular case, dealing with grocers’ wine licences, one can look back to the time when this was first granted, namely in 1963. This is relevant because the hon. the Minister, when he introduced this legislation, said that only 56 grocers’ wine licences had been granted since that amendment in 1963. The debate which took place on that occasion in June 1963 was a very lengthy one. At the end of that debate the question was put—in other words, the guillotine was applied—and a vote was taken. On that occasion there were some 57 members who voted against the principle of granting grocers’ wine licences. I was hoping to call upon a number of those members who are still in the House to oppose the extension of grocers’ wine licences, because obviously this is an extension which makes it easier to grant such grocers’ wine licences. Unfortunately, however, my call can only be directed at the one or two hon. members who were members at that time and who are still in the House. It might be of interest to know, Mr. Speaker, that one of the members who voted against the granting of grocers’ wine licences at the time, was the member for Queenstown. However, I do not propose to pursue that argument any further. I refer hon. members to col. 7845 in Hansard, 13 June 1963. The other member who is still a hon. member of this House and who could perhaps have some influence in trying to persuade the hon. the Minister of Justice to have a rethink in regard to this legislation, is Mr. S. J. M. Steyn, who is now the hon. the Minister of Community Development. This is relevant because the hon. the Minister of Community Development is at present considering recommendations that have been made to close certain outlets in a certain part of the Peninsula. The Fouché Committee found that an excessive number of liquor outlets did contribute towards misbehaviour in a particular area. It is significant to note that, when the provision concerning the granting of grocers’ wine licences was originally passed in this House, the hon. member who is now the Minister of Community Development was opposed to the granting of those grocers’ wine licences.

On each occasion, as I mentioned earlier, when concessions were made, liquor became more readily available in that liquor outlets were extended. This is cause for a great deal of concern to those persons who are endeavouring to try to tackle the problem of the abuse of alcohol. I do not intend pursuing this matter because we have had a full discussion on this particular aspect at Second Reading, but it does seem strange that all the appeals that are made to the hon. the Minister of Justice seem to fall on deaf ears as far as this matter is concerned. The hon. the Minister of Justice indicated during the Committee Stage that he has every sympathy with the point of view of the churches, the Temperance Unions and those who believe that, by the creation of additional outlets, one can only aggravate the problem of excessive drinking. However, the steps taken by the hon. the Minister appear to ignore the requests that have been made to him to introduce further restrictions, or at least to allow the status quo to remain, instead of granting further concessions. If the Bill were to be rejected at Third Reading, the existing position would obviously pertain.

In the past grocers’ wine licences have not been granted in the Western Cape because of the 30% restriction, but in that area, where there is undoubtedly a very serious problem with excessive drinking, the Liquor Board will be able to grant grocers’ wine licences in the future. The point of view has been expressed that wine is going to be associated with food because the wine is to be sold in grocery shops and in supermarkets. I have seen one or two of the premises where grocers’ wine licences have been granted, and in both the instances the wine counters are right at the door of the grocery shop. So there will, of course, be people who go in and buy wine, but they are not neccessarily going into the supermarket to buy food. It is merely another outlet for the sale of wine. The counter is positioned close to the door, and a person can make use of the facilities made available in a shop which is mainly selling food, but merely has these extra facilities to meet the extra requirements. The wine that is being sold is being sold close to the door, and the shop is therefore merely used as another outlet for the sale of wine. I therefore believe that we would be making a great mistake in proceeding with this legislation, particularly as far as the south-western Cape is concerned, and making it easier for the Liquor Board to grant these licences. I am not as optimistic as file hon. member for Hillbrow about the hon. the Minister perhaps withdrawing this Bill. I do not think he is likely to do that. Therefore the only thing I can do at this stage is to appeal to the hon. the Minister to see that the Liquor Board is made fully aware of the very strong objections, held by a very large body of opinion in the country, to any extension of liquor outlets, including the making of grocers’ wine licences more easily available to certain people, and to ensure that such licences are granted with the greatest degree of circumspection.

The hon. the Minister has indicated that 56 grocers’ wine licences have been granted over the last 16 years. It might be argued that this has not aggravated the liquor problem to any great extent, but I certainly cannot see how one can help the liquor problem in any way by creating more outlets and a greater pressure of advertising to entice more people to consume more liquor. After all, one of the main objectives of passing this legislation is obviously the greater availability of liquor. Therefore I do hope that the hon. the Minister will take cognizance of the objections, raised in this House and outside this House, to the granting of this further concession. I think that the hon. the Minister is fully aware, at this stage, of what the feelings are of a number of members sitting in this House. I am sure that there are members sitting on his side of the House who also have very serious doubts about whether it is a wise step to take the chance of perhaps aggravating an already severe liquor problem in this country by granting a further concession in terms of this Bill.

Mr. Speaker, before referring to a few of the consequences of the Bill, I should just like to react briefly to the ideas expressed by the hon. members for Hillbrow and Umbilo. I have the highest respect for the personal ideas, thoughts or principles of any person. During the Second Reading debate we discussed the principle of the Bill and went into the question of the excessive use of alcohol in depth. I do not wish to dwell on this again this evening except to say that I believe that as the level of education of our people rises—whether they be White, Brown, Black or Asian—the incidence of liquor abuse will drop. If there is one great task for all of us here, in my opinion, it is to raise the level of education of our people so that those who are in contact with or spend money on wine and alcoholic liquor will do so in a correct and civilized way.

I actually want to refer to what the hon. member for Hillbrow said. I hope I misunderstood the hon. member, but he accused the Government, including the Minister, of immorality. He referred, inter alia, to the “immorality of this Government”.

Morality.

If I incorrectly understood the hon. member I should be willing to apologize, but if I understood him correctly, I believe it is reprehensible…

I referred to their morality.

Very well. I accept the hon. member’s word in this regard. I am glad that I interpreted his words incorrectly. However, the hon. member for Hillbrow went on to make the statement “that we are sharing the interests of the liquor trade and we are going to blow up their profits.” It is this very industry that is opposed to this Bill because they see in it a danger that their own profits may drop. Therefore that argument advanced by the hon. member does not hold water.

The hon. member must bear in mind that we are dealing here with natural wines and in view of that I should like to ask him: What is the share of natural wines in the development of alcoholism in South Africa? In my opinion it is a minimal share. Natural wines have had a minimal share in the development of alcohol, and that still applies today.

Mr. Speaker, may I ask the hon. member a question?

Certainly.

In the 69 references to “bread and wine” in the Bible, did the wine referred to contain alcohol?

Mr. Speaker, there are several former clergymen in the House and I wonder whether it would not be better for them to venture a reply. When I refer to wine I take it that over the centuries, wines have contained a little alcohol. Indeed, we have already conducted a debate on the alcohol content of wines.

However, I wish to advance a few ideas relating to the possible consequences of this legislation. In the first place I wish to maintain that this Bill will put an end to the discrimination against the Western Cape as far as wine sales are concerned. The hon. member for Potgietersrus also referred to this. I have every respect for the bodies which have implemented the 30% rule since 1963. They may have had reasons for that, but there are other reasons why we made representations for this measure to be removed from the Statute Book. If this legislation is placed on the Statute Book, then in my opinion it will have the effect that the drinking pattern in the Western Cape will be able to develop as the then Malan Commission planned and foresaw it, viz. that natural wines would take the place of fortified wines and spirits as the basic drink. When this legislation is placed on the Statute Book it will also, among other things, bring to an end the struggle which has been waged for many years now by the KWV.

Another effect of this legislation will be that the positive reactions of wine farmers since 1963 will be acknowledged. I should like to refer to a few of these positive reactions to show how the wine farmers have reacted since 1963 when the question of liquor licences for grocers’ stores was broached for the first time. I want to say at once in this regard that the wine industry is a long-term industry. A farmer does not plant a vine today and take it out next week. A vine can easily produce for up to 30, 40 and even 50 years. Because this is so, these farmers had to make certain arrangements on their farms when there was talk of liquor licences for grocers’ stores and the freer distribution of natural wines. Provision was made in 1963 by way of legislation for wine licences for grocers’ stores and since that time the wine farmers have had to adjust their production accordingly to cope with the possible increased sales of wine. A second adjustment that had to be made by the wine farmer occurred in the early ’seventies when the demarcation delimitation system was introduced, based on the concepts of origin/cultivar/year of vintage. Then, too, the wine farmers reacted very positively as is evident from the variety of regional wines produced since then. From these two examples it is clear that the wine farmer has consistently reacted positively to the stimulation of the wine industry by the Government.

We are grateful to be able to say that since those years, in spite of the fact that this 30% provision came into operation, the wine farmer has nevertheless reacted positively to the stimulus of Government action. Thirdly—in the words of the hon. the Minister during the Nederburg wine auction this year—this Bill will afford a solution to the complexity of the problems in the liquor industry. I quote one paragraph from the hon. the Minister’s speech—

The hon. the Minister has sympathy not only for the wine farmer, but also for all the levels of the liquor industry—

This legislation is not an effort on the part of the State to assist the KWV to get rid of so-called surpluses. That is an incorrect interpretation. Someone did make this point in an earlier debate. I should just like to rectify a further point. I am in possession of a letter in which certain accusations are made against the aims of the Bill. I should like to set the mind of the author of this letter at rest The writer states that the obvious aim of this Bill is to cause people to drink more. The writer goes on, and I quote from Die Burger of 14 March 1979—

I want to say at once that I think that the writer of this letter can be assured that no disturbance or unpleasantness will occur at a store that has been granted such a licence. We must take care not to associate everything that is bad with this noble product of the vine.

In such circles the representations made by the KWV and the wine farmers are interpreted as a request that every café and every comer shop be permitted to sell wine. That is an incorrect deduction. This Bill will not have that effect.

As my sixth point I should like to quote one sentence from a newspaper clipping. Here I just want to mention that the hon. the Minister is not placing the Bill on the Statute Book as an intimidatory measure. It is not an intimidatory Act. I quote from The Argus of 11 May 1978. At a meeting of Fedhasa, one Mr. Schoombee, the executive director, said the following—

I do not think that this gentleman is drawing the right conclusion. We are not introducing this Bill in order to threaten or harm existing bodies. It is not the aim to have a detrimental effect on the existing rights of liquor traders. Let us say to each other that this is a Bill which aims at our marketing our natural wines in accordance with a natural method. One definite effect of this legislation will be that some independent licenceholders will now be afforded the opportunity to stimulate their wine sales. It is no secret that concern has often been expressed, through the KWV and other bodies, about the possibility of monopolistic conditions in the liquor industry. I wish to quote a short extract to hon. members from a speech by the chairman of the KWV on a recent occasion—

This legislation, when it is placed on the Statute Book, will have one important effect, namely that we shall now be affording the unbound and independent licenceholder the opportunity to stimulate his wine sales.

In the eighth place the producers believe that the effect of this legislation will be that the sales of good wine will be promoted. Take note that I do not say the sales of alcohol. I do not say that more liquor will be consumed. I say that the wine farmer believes and hopes that the effect of this legislation will be that the sale of good wines will be promoted. Increased sales of natural wines entail great benefits for the wine producer particularly, due to the difference in the minimum prices payable to wine producers for good wine and for distilling wine. Hon. members would be amazed if I were to tell them what the differences in price is between distilling wine and good wine.

I should like to express the hope this evening that the hon. member for Hillbrow and other hon. members who are opposed to this legislation will assist us in promoting the philosophy which the hon. the Minister also endorses, viz. that wine should only be served with food, and that wine and food be associated with one another. It is important to us that wine should not be associated with liquor abuse but that wine should be seen, treated and respected as a product of civilization.

Even hon. members who voted against the Second Reading of the Bill and who are also going to vote against the Third Reading this evening or will perhaps refrain from voting can assist in this regard in giving effect to the constructive purpose of the legislation. That aim is that wine be associated with food. Wine should only be consumed at a meal, and in a civilized way. I shall make just one further reference to the hon. member for Hillbrow before concluding. The hon. member states—

Does the parent not also have a duty to say to his child: “My son, my daughter, this can be a dangerous tiling when one does not use it correctly?” I think the hon. member for Hillbrow and, in fact, all hon. members, have a duty to their children to educate them in the correct use of wine.

In conclusion I want to refer to one last effect of this legislation when it is placed on the Statute Book. It will bring clarity to the retail trade in that they need have no fear that wine producers will establish artificial cooperatives and that wine farmer’s licences obtained in such a way will compete on a large scale with existing retailers. The legislation puts it very clearly that this will not be permitted. All that will now happen in terms of the legislation is that the position of co-operative that are involved in wine farming on a bona fide basis is confirmed. In this regard I refer to the authorization in terms of section 24 as well as the authorization which may be granted if the wine farmer’s licence is applicable to a cellar at a different place and not at the farm cellar.

In conclusion I want to thank the hon. the Minister for his sympathetic approach to the legislation. I want to thank him and his department for having introduced the Bill. I believe that the Liquor Board, in its wisdom, and with all its experience, will see to it that the aims of the Bill will be realized in practice in the interests of the producer and the industry, but also in the interests of the consumer.

Mr. Speaker, the hon. member for Worcester, when he puts a case, can put it very well. Unfortunately he said nothing which caused me to change my view. The hon. member is also quite capable of defending himself.

But the principle is not at issue now.

Nevertheless, in defence of the hon. member I want to say that in my opinion the hon. the Minister of Agriculture was very unreasonable in the question he put to him. Just as the hon. member for Worcester cannot tell the hon. the Minister whether there was alcohol in the wine referred to on 69 occasions in the Bible, the hon. the Minister is in my opinion unable to tell us whether there was margarine or butter on the bread referred to 69 times. [Interjections.]

But I am sure that there was alcohol in that wine.

I want to touch on two matters. The first is something which perhaps caused a misunderstanding during the Second Reading debate. I referred to the danger, as I saw it, which would arise if a young boy or girl under the age of 18 years were to pass the cash register in a supermarket with a bottle of wine in his or her possession. In his reply the hon. the Minister created the impression—perhaps not intentionally, but nevertheless—that I was under the impression that the legislation did not apply in that case. I want to state very clearly that I am aware that the Liquor Act will apply as much to a supermarket as to a liquor store. However my argument was that if a person under the age of 18 years passed the cash register at a liquor store and paid, the licenceholder would be on his guard because he would want to retain his licence. He would make doubly sure that the person concerned was in fact over the age of 18 before permitting him to leave the liquor store with a bottle in his possession. If not, his licence would be endangered. Of course, his licence would be equally at risk in a supermarket.

What is the point, then?

I am coming to the point; the hon. member need not be hasty. We all know that when the supermarkets are short of staff, particularly during holidays, they appoint high school scholars and students to work for them on a part-time basis. Have hon. members ever tried to buy anything at a supermarket in Cape Town on a Friday evening? Have they seen the long queues of people with loaded trollies? Have they taken note of the age of some of the cash register attendants? The point I want to make …

Dan, you are conjuring up spectres.

No, I am not conjuring up spectres. I think I am dealing with realities. If a scholar under the age of 18 years is at the cash register he is eager to assist as many clients as possible. He is not going to take the trouble to ask a client whether he is 18 years old or not. It is not only the scholar who will omit to ask that, but also adults serving there.

That is the danger.

These are the dangers I have seen and it is for that reason that I objected, and I want to repeat it this evening to make it clear to the hon. the Minister that although the Act applies equally to a supermarket and to a liquor store, the danger at the supermarket is far greater than at a liquor store. That is all I want to say about this matter.

I want to rectify another matter. Owing to an interjection in the Second Reading debate, the hon. the Minister of Coloured Relations and I had a slight altercation, all in a good spirit, of course. However, when I read my Hansard I realized that I had definitely done the hon. the Minister a disfavour. The hon. the Minister remarked: “Do you remember the time you hid the wine?” I replied: “Yes, you hide it for your friends” and so on. I do not want to go into that further. I now want to recount briefly to hon. members what happened, because in fact I am proud of it. Although I am opposed to the sale of wine at a supermarket, I am in favour of the proper use of wine.

Good show!

When the municipality of which I had the great honour of being mayor entertained guests, we were proud to serve the guests with wine, among other things. On the evening when the hon. the Minister was my guest, he was unfortunately unaware that we kept different kinds of liquor at different tables. He asked me whether we did not have wine. I willingly fetched him a bottle of wine.

It was outstanding wine, but you hid it away.

The hon. the Minister was under the mistaken impression that we had hidden the wine. However, we distinguished between old spirits drinkers and wine drinkers. However, the hon. the Minister got his wine. The remark I made in a good spirit in the House really did not apply to the hon. the Minister and I feel it is my duty to rectify this here this evening. I want to tell him that if he visits Port Elizabeth again he can be sure that there will be wine for him. When I became a member of the city council of Port Elizabeth 13 years ago, they only served spirits and beer and I pride myself on having seen to it that they also began to serve wine.

Mr. Speaker, I now come to my last point, and I am not like the hon. member for Worcester who had six last points! [Interjections.] If the legislation is passed—and I have a feeling that that will happen—I want to ask that we be consistent about this matter. If wine is to be sold at one supermarket, it might as well be sold at all supermarkets. Now I come to a very important matter. Legislation makes provision for the sale of wine in supermarkets by hotels and liquor stores, and I fail to see why the wine and malt licenceholder should not enjoy the same privilege. Over the years it has been the wine and malt licenceholder who has promoted wine because he has not had spirits and other strong drink to offer. The wine and malt licenceholder is thus far the person who has put wine on the market. That is my request, and I thereby wish to conclude…

Dan, now you are stealing my thunder (donder)! [Interjections.]

Mr. Speaker, I wonder whether that word is parliamentary! If the legislation is approved, let us be consistent and give the wine and malt licence-holders the same privilege as is being given to the hotels and liquor stores so that they can continue to promote wine. There are 65 wine and malt licenceholders in the Boland and I do not think it would make much difference if they were also to enjoy this privilege. This is an amendment which the hon. the Minister could very easily effect in the Other Place.

Mr. Speaker, we are now discussing the Third Reading of this Bill, a stage at which we consider the consequences and the effect of the Bill. I just want to say that I personally am going to refrain from voting if there is a division. That is just as good as voting against the Bill. I hope that in the future I shall refrain from voting on a measure such as this consistently and out of conviction if I do not vote against it There is no doubt whatsoever in my mind that if this specific measure is placed on the Statute Book it will certainly result in an increased consumption of wine in the South Western Cape. I really think the Opposition will believe me when I quote from the periodical To the Point of 16 March 1979. I want to quote a statement by the managing director of one of the biggest wine-producing and distributing groups in the Cape. Discussing the proposed legislation, he said—

There is no doubt whatsoever in my mind that this Bill will result in increased sales of wine as a result of more outlets. This brings me to one of the consequences of this legislation. It is said that people will buy liquor in any event whether it is sold at a specific place or not. That is a myth. All the facts of the liquor trade in South Africa, the advertising of liquor and the additional liquor outlets opened from time to time, show quite clearly that the argument that people who want to drink, will drink in any event, is false. The basic fact is that the more distribution points there are, the more people will drink. One simply cannot argue against that. The question arises as to whether we want people to drink any specific product The plain fact is that millions and millions of rands are spent on liquor advertisements to promote the sales of alcoholic liquor. In this regard one should also take note of the advertisements on television. I personally do not like them. I think it is wrong and that they must be stopped. I think we must refrain from romanticizing alcohol, whether it be wine or anything else, on television and glorifying it to such an extent that we even link liquor consumption and sport, masculinity and I don’t know what else.

I just want to say that I am not a teetotaller or a person with an antipathy towards the wine industry here in the Cape. On the contrary, the whole wine industry in the beautiful vineyards of the Boland and the noble uses of wine, as the hon. member for Worcester said, are to me a fine thing and I have no objection to them. But in the first instance I am concerned, as I have already said, that we are dealing here with the myth that we are not going to stimulate liquor sales by means of this measure. In the second place, there is a myth about the concept of alcoholism. Arising out of this measure I should like to say something about this. We could speak for hours about the concept of alcoholism, where it begins and ends. As far as wine is concerned, however, there are two things we must not do. In the first place we must under no circumstances say that wine as an alcoholic beverage has nothing to do with alcoholism. Nor must we say that wine has nothing to do with other lesser evils allied to alcoholism, namely excessive liquor consumption and liquor abuse. It is an absolute myth to seek to divorce alcoholism from any alcoholic beverage. Alcoholism is a personality and a community problem. If one asks oneself why people drink, one could answer that it is a social custom and part of one’s culture. One could also ask oneself why people drink too much. There are many opinions on why people drink too much. The reason lies in the individual. People say that an alcoholic is born. That is not true. When one sees people who harm themselves with drink and eventually become alcoholics, this weakness in their personality often has to do with society and their interaction with other people. For example, they say that one cannot treat a married alcoholic without also treating his wife. The fact that in his personal weakness he succumbed to liquor and eventually progressed to total enslavement to drink, is connected with the fact that the interaction between him and his wife is not as it should be and that that interaction helps towards causing the man to show his weakness in that way. Thus we have interaction with society. We are living in a world of great uncertainty. We are living in a society in which there is a great deal of tension. All these factors—the uncertainties, the tension and the interaction of the individual, who is guilty of liquor abuse, with other individuals and with society—are factors that contribute towards liquor abuse.

In discussing the consequences of this legislation there is another factor which we must take very fully into account. It is the fact that we in this country have communities, a large number of people who live at a socio-economic level and in accordance with the socio-economic standard at which the personality problems of the individual in a complicated, uprooted and disrupted society can cause very major problems. The statistics with regard to the Brown population—I have already quoted the figures—show that 161 000 Brown people are classified as people who abuse liquor. 43 600 are alcoholics and a further 34 000 are pre-dependent drinkers. I obtained these statistics from the Department of Coloured Relations. 22% of the Brown population above the age of 20 years abuse liquor. Let us consider the position among the Black people, and what I want to say now, I say with great respect towards the hon. the Minister of Justice. The situation with regard to excessive consumption of liquor, liquor abuse and alcoholism among the Black communities and peoples in South Africa is a cause for concern to which the Government—all of us—must give urgent attention if we are not to encounter a situation in future in which thousands of otherwise active Black and Brown people will be useless to society as workers and entrepreneurs due to addiction to liquor. I have no doubt whatsoever about that, particularly if one sees how the situation is developing among those people.

I spoke about poor socio-economic conditions. There is also a myth that when we discuss alcohol, we should only talk about the alcoholic. However, the alcoholic represents only the final stage of a long history of drink problems and drink abuses. I am quite convinced that we sometimes forget entirely about the problems involved in excessive consumption of liquor and liquor abuse. Bearing in mind what the catastrophic results can be, I am convinced that even though this is not the aim of the Bill, at this stage of the socio-economic problems of the development of the Brown people and the socio-economic problems of the Black people, this is a measure which will lead not only to more consumption of alcohol, but to excessive consumption of alcohol. We need not have any illusions about that, because the more wine there is available, the more drinking there is, and the more people drink wine, the greater the abuse.

I agree with the hon. member for Worcester that we must educate the people in South Africa in this regard. However, there is one thing which causes me very grave concern, and in this regard I should like to put a question to the hon. the Minister. This year the State received about R1 009 million in excise duty on the sale of spirits, wine and other alcoholic beverages. Last night I referred, inter alia, to the position with regard to Whites. Last year the Department of Social Welfare granted an amount of R1 895 000 in subsidies for the combating of alcoholism. The fact is that the Government—any government—cannot evade the reality that we have a vested interest in the liquor industry. We have a vested interest in the production of liquor, we have a vested interest in the distribution of liquor and we also have a vested interest in the consumption of liquor. I do not wish to maintain that it is in the interests of the Government to cause more and more people to drink more and more so that it can obtain more money from tax. I believe in all honesty that we must maintain a balance and that we must not act in an unbalanced fashion in this regard. If we want to act in a balanced way, we must admit that we cannot get away from the realities of liquor production, liquor distribution and liquor sales. Indeed, it is a vast industry. However, I want to put it forcefully to the hon. the Minister that since we are placing this legislation on the Statute Book, we should also launch an intensified information campaign to educate everyone in South Africa—White, Brown and Black—and inform them thoroughly as to the dangers of excessive liquor consumption, the dangers of abuse and the dangers of alcoholism.

Hear, hear! I second that.

If we could exchange a few ideas this evening about the frightening effects of liquor abuse and excessive consumption of liquor on the minds of thousands and thousands of young children, everyone would agree that this is a matter about which we must be concerned. Perhaps there are hon. members sitting here this evening who have not experienced such problems, but I want to ask them whether they realize what impact liquor abuse or the excessive consumption of liquor by a father or a mother has on the children of the house. The tragedy is that more and more women are drinking excessively today. Not only does this lead to neglect and maltreatment of their children; it also often causes a personality problem at an early stage of their lives which could eventually cost the State millions upon millions of rands—the direct consequence of the fact that the children suffer disturbance of their personalities which remains with them throughout their lives so that they are unable to be as good and useful citizens and make as much of a contribution as those who have not been subjected to that tension and have had a more balanced personality development.

I want to conclude by again saying to the hon. the Minister, in all earnest, that I shall refrain from voting on this legislation, not because I feel that it is the intention of the Government to cause people to drink more, but because I personally feel concerned about the effect of liquor abuse in this country.

We are all concerned about that.

I do not want to get worked up about the matter because if we were to do that I am quite convinced that with the facts and the information at my disposal, and with my convictions which are based on such facts, I too could get worked up. I believe that our efforts to combat this evil should be of the same extent as the free availability of liquor. This can and must be the case.

Mr. Speaker, I would just like to say to the hon. member for Innesdal that the best aspect of his speech was the fact that, sitting in the Nationalist benches, he was still able to speak, as he did very elegantly, against the Bill. I think that this is a change of heart and spirit which augurs well for the quality of the debate from hon. members on that side of the House. The hon. member for Innesdal is an eloquent speaker. He came through very well and his delivery was excellent but unfortunately, like so many hon. members who have spoken against this Bill, he has come with false assumptions and false hypotheses and he has traded on the tragedy that a minority, in a very small percentage, of the population do suffer the physical and psychological ills of the excessive use and abuse of alcohol.

If we are going to examine the effects of increasing the distribution points, then it is encumbent upon hon. members of this House to look at the facts and not the figments of their imagination. There seems to be a considerable amount of ignorance regarding the process of alcoholism. This erroneous thinking has led to the kind of lack of logic we heard from many hon. members, including the hon. member for Hillbrow. The hypothesis which they put forward is more or less that, if one increases the distribution points for wine, one will be increasing consumption and, if one increases consumption, that will lead to increased drunkenness which in turn will lead to increased alcoholism.

It is a fact.

The hon. member for Port Elizabeth Central says that that is a fact It is erroneous. A thorough examination of the scientific statistics in South Africa and in every Western country—we are dealing with the Western culture—will show hon. members that alcoholism as such represents no more than 3% to 5% of the ills of that population.

Six per cent.

In France the figure may be 6%. However, in Italy, where wine is freely available, it is 2,5%. It is an erroneous assumption and hypothesis that increased consumption leads to increased drunkenness which in turn leads to increased alcoholism.

I would like to suggest to the hon. member for Hillbrow that he must read the book from which he quoted very thoroughly as he will then come across a great difficulty, which he did not refer to, viz. what the definition is of an alcoholic. If he looks at the definition of an alcoholic, he will see that there are two types of alcoholics. It is described in that book quoted by the hon. member for Hillbrow. The one is a biological alcoholic and the other a psychological alcoholic. It is not true to say that increased consumption leads to increased drunkenness, and it is certainly not true to say that increased consumption leads to increased drunkenness, and it is certainly not true to say that increased leads to increased alcoholism of either of those two types.

I would like to point out to the hon. member for Innesdal that, if he takes the trouble to ask the larger manufacturers of wine in the Western Province to give him the statistics of the consumption factor amongst the Coloureds, he will be pleasantly surprised to see that during the last two years the per capita consumption of wine amongst them has dropped. I would suggest that the hon. member for Hillbrow should also take the trouble to consult the wine producers here. [Interjections.] Alcoholism is today recognized as an illness and, because we have a more free and tolerant society, more true alcoholics—and I am referring to the seven-stage definition—are coming forward for treatment of this illness. That is the reason why the number of alcoholics reported is increasing. Previously they did not come for treatment, but now they do. In fact, an alcoholic can now even be treated on medical aid. The result is that a greater number of people come for treatment.

The misuse of alcohol leads to drunkenness, but not necessarily to alcoholism. However, I would like to tell the hon. members for Innesdal and Hillbrow that the reason why the per capita consumption and the misuse of alcohol amongst the Coloureds, who did have the highest rate of drunkenness and a fairly high degree of alcoholism, has dropped is that the self-esteem of the Coloured population of South Africa is being restored. The nub of the problem lies there. It is not the number of distribution points or the availability of the liquor that increases the rate of alcoholism or drunkenness. I would like to repeat that drunkenness and alcoholism have nothing to do with the amount of alcohol consumed by a population group.

I am not talking about individuals. I am talking in general. We find that because we have now created better social conditions for Coloureds, because their standard of education has increased, because their opportunities for work and their per capita income have increased, their families have been reconstructed into proper family units. Their self-esteem has increased, and therefore their anxiety factor, as mentioned by the hon. member for Innesdal, has been decreased. They have a better family structure. Their self-esteem has increased, and therefore there has been a drop in wine consumption amongst the Coloureds.

I should like to go a little bit further now, and say that the kind of arguments that have been used by hon. members who are trying to prohibit the distribution of wine, are totally innocuous. The arguments they have used are the usual kind of fallacious arguments, such as the statement that robberies in Cape Town are increasing because there is an increase in the population, and therefore there is an increase in the number of potential victims who can be robbed. Therefore, they would say, we must start practising birth control in order to reduce the number of people so that the number of robberies can decrease because the number of potential victims will be decreased. [Interjections.] That is the kind of fallacious argument being put forward by hon. members, unfortunately some of them of my own party. That is also the kind of fallacious argument advanced by the hon. member for Hillbrow. [Interjections.]

I should like to point out a further example of the illogical arguments used by hon. members who are against this particular legislation; that is to take the number of road deaths—tragic as they are—and the number of people injured in accidents on our roads in South Africa. These numbers are increasing every year. At the moment we have a figure of almost 4 000 fatal injuries and at least 10 000 very serious injuries. However, does that mean that the cause lies in the number of motor vehicles distributed? Such an argument is nonsensical. The number of motor vehicles is going to increase. However, bad driving, bad adherence to road safety rules, and the lack of education is the real cause of that number of accidents. An investigation of those accidents will show that mechanical failure is probably confined to less than 1% as a cause of those accidents. In most cases the cause is human error. Nevertheless, that does not mean that we must start banning motor vehicles, that we must start discouraging the distribution of motor vehicles by closing down the existing distribution points. [Interjections.] Physical and psychological damage done to people in South Africa by motor accidents is greater than that done by alcoholism. Tragic as the outcome of… [Interjections.] When we have brushed aside the emotional appeal, the lack of facts and figures, the illogical arguments used by hon. members against this legislation, I believe it is improper to suggest that the provisions of this Bill are going to increase the incidence of alcoholism.

Hon. members who would like to take the trouble to study the medical and psychological facts and figures in connection with wine, as well as the distribution figures of wine, I am sure, will realize, once they have done their homework properly, that this legislation is not going to increase drunkenness or alcoholism, and that the causes of those particular problems are remotely separated from the distribution of wine. I have no difficulty at all in supporting this Bill at Third Reading.

Mr. Speaker, I should just like to examine a few of the statistics quoted by the hon. member for Durban North more closely and compare them with others that were published in the S.A. Medical Journal. The S.A. Medical Journal claims that 45% of the road accidents in South Africa are attributable—not as a contributory factor, but directly attributable—to abuse of liquor. [Interjections.] According to this publication 65% of the road accidents which occur between 6 p.m. and 6 a.m.—that is, those people who drive at night—are attributable to the excessive use of alcohol. Now let us therefore…

Yes, but what kind of alcohol is it?

Wait a moment, we are still coming to that. The hon. the Minister of Coloured Relations must exercise a little patience. I shall prove to him why it is important that wine should also be mooted in this matter. In 70% of all those who died on our roads, pedestrians, motorists and others, it was found that the alcohol content of their blood exceeded the maximum permitted by the Act. Consequently there is a tremendous alcohol factor as far as road accidents is concerned.

But what does that have to do with grocers’ wine licences?

Of course the hon. the Minister wants to know what this has to do with wine, but let us consider the matter in a very level-headed way, from Worcester right down to Paarl, and think about it. Where does the greatest degree of alcohol abuse in South Africa occur? Is it not in the Western Province?

Yes.

Is the Western Province not in fact that part of South Africa in which the most wine is produced? Is it not also that part in which wine—we are referring once again to unfortified wine, ordinary natural wine—is the most readily available? Is it not a tradition in the Western Province that workers are given wine? Is it not an old, time-honoured tradition? It is strange that the workers in the Western Province are in fact the people who manifest the highest percentage of liquor abuse or alcohol addiction. Is it sheer coincidence that these two factors coincide? In France there is a tremendous degree of liquor abuse, the country in which wine is praised as the great, the noble nutritive material. Is it not strange that these two factors also go together in the case of France?

Wine is regarded in the same light as food in the Western Cape.

The hon. member for Durban Point spoke about alcoholism. Let us not become entangled in definitions now. I am talking about liquor addiction; that is, those people who find it very difficult to do without liquor. Those are the people to whom I am referring when I talk about alcoholism. The Encyclopaedia Britannica says that alcoholism, in that sense, is incurable. One does have abstinence. One does find people who, through abstinence, through will power, through training and through self-discipline and discipline have learned from others to resist the temptation of drinking wine or other liquor. However, there are people who tread the verge of a precipice. If they consume only a drop of alcohol, in any form whatsoever, even if it is the noblest of wines, the precipice looms before them.

I want to raise another point briefly because we have by now debated these matters to such an extent that I feel there is not much more that can be done on one side or the other. As an outcome of the Bill we are going to have an expansion of the distribution points in the Western Province and in this connection I have a question to ask. I am addressing it in particular to the hon. member for Paarl. What type of wine do we think the supermarkets will offer for sale? Will it be the best wines at R2, R3 or R4 per bottle or will it principally be wine which sells at less than R1 per bottle? In a supermarket the manager is usually bent on one thing only, and it makes no difference whether he is selling liquor, flour or any other commodity: He does not want his stock to gather dust on the shelves. There must be a constant turnover. I am now referring to the Wynberg supermarket where I usually buy my groceries. In that supermarket wine will be offered which more or less suits the taste of the middle-cláss buyer and the person who earns even less than the middle-class buyer. It will be wine which is cheap, but not necessarily very good. There may also be wines of the cheaper type, for example of the sherry type which is a very cheap and very dangerous type of alcohol. It is consequently no use saying, as was said at the beginning of the debate, that what is involved here is not increasing the consumption of alcohol. Of course it is aimed at increasing consumption. The hon. member for Innesdal was of course 100% correct when he referred to the increased consumption of wine. Wine can be a dangerous drink; I am not saying it is a dangerous drink. For the most part it is not. The greater the consumption of wine, the greater will be the abuse, and the greater the abuse, the more alcohol addiction there will be.

One of the great social problems we have in this country is liquor abuse. There is no doubt about it. I am not saying that all of it is attributable to wine, but it is an enormous problem. Liquor addiction is incurable. Once a person has gone to excess in the abuse of liquor, he always runs the risk—it makes no difference whether he has been a total abstainer for 50 years—of going over the precipice again.

Mr. Speaker, it is a striking phenomenon that legislation pertaining to alcoholic liquor always gives rise to long discussions. In the discussion of the present Bill, there has been no difference in this connection. We have discussed and debated this Bill, in its various stages, for hours already.

The arguments throughout have had very little to do with what is actually stated in the Bill, or what the actual implications of the Bill are. Almost throughout the discussion centred on the question of liquor abuse and its accompanying evils. The hon. member for Johannesburg North, who has just finished speaking, was no exception to this rule either.

The hon. member for Innesdal, in my opinion, correctly contended that one cannot separate liquor abuse from the consumption of alcoholic liquor. But I want to contend that it is equally true that the consumption of alcoholic liquor is not inevitably associated with liquor abuse. While we have to concede that there can be no liquor abuse without the consumption of alcoholic liquor we must, if we want to be fair, also concede that all consumption of alcoholic liquor does not inevitably give rise to liquor abuse. Consequently I think it is wrong, in the evaluation of this Bill, to keep on harping on the scourge of liquor abuse and its accompanying evils.

I want to put it very clearly and categorically to hon. members of the Opposition who oppose the legislation that I, and I believe every hon. member on this side of the House, are equally opposed to and feel just as troubled by any form of liquor abuse as they are. I want to say, so that there need be no doubt about this, that this side of the House will not support any system or measure which would inevitably promote liquor abuse or which would or could give rise to alcoholism.

We frequently have long discussions of liquor legislation, principally for two reasons! Firstly because hon. members on both sides of the House hold fixed views on the abuse of alcoholic liquor. I want to add at once that I personally—and I believe all hon. members on this side of the House—have the greatest respect for the premises of hon. members on the consumption of alcoholic beverages. We do not deny anyone the right to their personal premises on this matter. A second reason why this kind of legislation frequently gives rise to prolonged arguments is that there is frequently a large dollop of sentiment involved in the matter. We are frequently inclined to become very emotional and sentimental when it comes to alcoholic beverages. It is the easiest thing in the world to progress from the inaccurate premise to the next unfounded argument and then arrive at a completely untenable situation which we then couple unjustifiably to the mere consumption of alcoholic beverages per se.

I believe that when we are considering legislation of this nature, we should at all times approach it in an unemotional and realistic way, and that there are certain unavoidable facts which we have to bear in mind in this connection. The first is that alcoholic beverages are basic commodities. That may perhaps sound like a far-fetched statement but the fact of the matter is that nowhere in the world has it been possible to cause total prohibition to succeed.

Order! The hon. member must return to the Bill.

I do not think I am digressing from it in any way, Mr. Speaker. I just want to emphasize the fact that alcoholic beverages are today considered by the community to be a basic commodity. People will acquire and consume it, regardless of whether they purchase it in the form of light wine in a grocery store or acquire it in another way or in another form somewhere else.

They brew it illegally.

The hon. member for Port Elizabeth Central said that people brew it illegally. I find it interesting that there was in fact a television programme last night on how alcoholic beverages were already being brewed years ago, and are still being brewed. That simply goes to show that people will meet their liquor requirements, whether they buy it in a supermarket or obtain it in some other way.

The second fact which I think we should keep in mind is that the wine industry is an important part of our economic infrastructure. I am not championing the interests of the wine farmer now, but it is a fact we cannot escape.

The third fact is that there are various other interests and interest groups involved in the matter, interests and interest groups which are frequently in sharp conflict with one another.

A further important fact that we must bear in mind is that an alcoholic beverage is a controlled commodity. The State controls the distribution of alcoholic beverages. This places a great responsibility on the State. The State has to control the distribution of alcoholic beverages in such a way that the reasonable requirements of the consumer are complied with without promoting liquor abuse. As far as this aspect is concerned, it is therefore necessary to maintain equilibrium at all times: On the one hand there are the reasonable requirements of the consumer and on the other the prevention of the abuse of alcoholic beverages. At the same time the vested interests of the wine farmer and other interest groups must be borne in mind. Therefore the hon. the Minister who has to administer and implement the Liquor Act, has the responsibility of ensuring that justice is done to all.

It is very easy, if one is not charged with this responsibility, to advance all kinds of arguments and to express all kinds of preconceived ideas on the matter, if one does not ultimately have to take a balanced decision. However, when one is placed in the position in which the hon. the Minister finds himself, that one has to adopt a balanced standpoint in the light of all these considerations and embody it in legislation, one cannot afford to become emotional on the matter or allow oneself to be taken in tow by all kinds of emotional and sentimental arguments in this connection.

If we examine the present Bill, we find that fundamentally it is concerned with two things. It is concerned fundamentally with the abolition, by means of clause 2, of the existing 30% restriction, about which a great deal has been said in this and previous debates. In the second place it is concerned with the provisions relating to the granting of grocers’ wine licences to the holders of liquor store licences as well. That is what is involved here, and I want to emphasize that there is no question whatsoever in the Bill of there being uncontrolled distribution of light wines. It is concerned only with grocers being granted the right to distribute and sell light wines as well. It is not a case of a general concession being granted here. It is a controlled concession. The strictest control will continue to be exercised over this matter. In other words, it is not a case of the cellar doors being thrown open. It is merely a case of the sale and distribution of light wines not being limited to certain licensed premises, but of this concession being extended to such grocers who, in the opinion of the authorities will qualify to operate this concession.

If we examine the 30% restriction closely, we find that we are dealing here with a restriction which, in the first place, was an arbitrary one in view of the determination of the reasonable requirements of the public. It was deemed that where the consumption of light wines already constituted more than 30% of the total of consumption of alcoholic beverages in a district, no additional outlets were required. However, this brought about a completely unrealistic situation. This has been mentioned repeatedly here in this House. But it is a fact that only three of the 56 grocers’ wine licences that had been granted since 1964, were granted in the Cape, and not one in the Western Cape. I can testify personally to how I was once visiting King William’s Town in the Eastern Cape and ordered a bottle of red wine there, only to be informed that there was not a single bottle of red wine to be found in the whole of King William’s Town. [Interjections.] Hon. members must not please waste my time. I was informed that all the red wine in King William’s Town had been purchased by people from the Western Cape and transported here. The fact of the matter is that it was precisely here in the Western Cape, the heart-land of the wine industry that it has occasionally appeared to be difficult to obtain table wine.

Here in the Western Cape wine is food.

I want to add that not everyone in the Western Cape are members of wine farmers’ co-operatives who want to buy light wines in liquor stores. In my opinion there is a reasonable need among the consumers of light wine in the Western Cape to be able to buy wine in grocery stores, as in other parts of the country. Reference has already been made to monopolistic conditions which arose in this connection, and I do not want to venture into that sphere again.

I want to conclude by referring once again to the arguments pertaining to liquor abuse. The causes of liquor abuse are frequently to be found in a wrong attitude to alcoholic beverages. People seek escape from their problems in liquor. People are frequently guilty of liquor abuse for the sake of the adventure which venturing into a previously unknown territory represents, while others seek social acceptance through it. I believe that the correct approach to the consumption of alcoholic beverages lies in enjoying light wines with meals. I believe that the provisions of the Bill will in fact promote this correct attitude by ensuring that light wines may be purchased together with food in grocery stores. This will cause the idea to take root that light wines form part of a balanced meal. By furthering this correct attitude, I believe that the Bill is in fact contributing to counteracting the abuse of alcoholic beverages in its stronger forms, e.g. spirits. Consequently I believe that those who are concerned about liquor abuse should in fact support this legislation, as I shall gladly do.

Mr. Speaker, the hon. member for Mossel Bay will not be surprised if I am less than enthusiastic about the argument he presented this evening. I would take issue with him on one of his statements, namely that alcohol is considered in this country to be a basic commodity. I do not think we should look upon alcohol as a basic commodity, but more in the light of its being an expensive luxury. When we add up its true cost to the country in all respects, we will find it is a very expensive luxury indeed. Towards the end of his speech the hon. member did come very close to some of the reasons why alcohol is abused and on those grounds one could start agreeing with him. However, I would put it to him that the conditions in this country lend themselves to stress situations, which to my knowledge is one of the major reasons for alcoholism. Looking at the country with its diversity of races, language groups, cultures, living standards and religions, I want to suggest that there is no other country in the world with this diversity, a factor which gives rise to stress situations.

We have reached the Third Reading stage of this Bill and must look at the possible effects that it is going to have. I want to say that I think it is strange that we have a Government that does not believe in gambling, yet it takes a calculated gamble with this legislation. The fact remains that despite certain research that has been done, there is nobody who can stand up and say with certainty what effect the extension of licences is going to have. The hon. the Minister must admit that there is nobody who has done research into what effect this will have in the particular and peculiar circumstances in which we in this country live and find ourselves. Let us look at some of the things which will happen if this Bill is passed. It is obvious that in the first place there is going to be higher sales of wine. It seems to me that we are also going to see more price wars and loss-leaders in wine. People not previously exposed to wine in the market place will now be tempted to buy wine at the new outlets. If one went into a bottle store before now, one’s intention was to buy liquor and if one went into a food store it was to buy food. What we are going to find now is that people who enter grocery stores and supermarkets are going to see the liquor possibly at a cut price and as loss-leaders, and consequently will be tempted to buy more of it than was previously the case.

You are talking rubbish!

I do not think it is rubbish. I think it is a reasonable possibility and I think it is what we are in fact going to see.

I want to go a stage further and say that I think…

Mr. Speaker, I should like to ask the hon. member, and from the nature of his profession, he will be able to give me an honest reply: which is more dangerous, the free distribution of natural wines or the free distribution of headache tablets and powders which are so freely available in pharmacies? [Interjections.]

That is a very fair question. I should like to tell the hon. member that both are dangerous.

†The one is not worse than the other. They are both dangerous, and we accept it I think it is a very good point indeed that the hon. member for Springs has made. However, to get back to my argument I would say that what we are likely to see is the lowering of the average age of alcoholics in this country. I think this is going to come about because the structure of the family unit has become very much looser over the years as a result of jet travel, buzz-bikes, mopeds, scooters and cars for young students. The family unit is now stretched and no longer enjoys the strong ties it used to enjoy. Children and youngsters no more grow up in the family atmosphere where they learn to take a drink with meals under parental supervision. We now find that young people at universities and even in the boarding establishments of high schools are going to be exposed to the temptations of liquor at a younger age and without parental control. So I think we are going to find more young alcoholics, and I think this is something which we shall have to watch carefully.

I think another consequence of this Bill is going to be more advertising aimed at younger people.

There is one very significant point which has not been raised in the debate on any of the stages of this Bill, and this is that it is permissible to advertise wines on TV, but the stronger alcoholic drinks are not advertised. To me it is very significant that, over the period that we have had a TV service, this situation has become accepted, and we are now going to open up the outlets through which wine will be available. I see this as a significant point, one which has relevance to the debate in which we are engaged. I believe it is encumbent on us as public representatives to watch the trends of TV advertising, to monitor the trends that may lead towards a glamorizing of drink in the lives of young people and aim at encouraging more young people to drink. If we see this trend developing, I believe it is going to be encumbent on us to educate people and to make them aware of the fact that wine contains alcohol. One only had to listen during this debate to some hon. members on the other side of the House who expressed surprise when we told them that wine contained alcohol, and other members who expressed great surprise at the actual percentage of alcohol in wine, to realize that there is a tremendous amount of ignorance among people without a technical education as to the actual content of alcohol in wine.

I want to end by saying that, this is the case, if we notice a trend in advertising on TV whereby younger people are persuaded to drink wine in greater quantities and at a younger age, we must look very carefully at the possibility of insisting that the wine advertisements on TV should carry a by-line to the effect that: “This product contains alcohol which is habit-forming.”

Mr. Speaker, we have now come to the end of a very long debate on this Bill. I want to thank all hon. members sincerely for their participation in the debate. If I may summarize the debate I can say that, although hon. members discussed liquor abuse in general, there was almost no hon. member who made statements with which I could not agree. On this side of the House hon. members said things about wine and its use, and about the use of liquor in general, with which one could also agree. It was one of those strange debates in which one could agree with almost every hon. member who spoke. With all due respect, I must say that very few hon. members spoke specifically on the Bill. [Interjections.] Hon. members who argued against the abuse of liquor and all its associated evils, said things with which I am in complete agreement. We also heard from those who use liquor in such a way that it serves as a food. With that, all of us can also agree.

As far as this Bill is concerned, however, there is no doubt in my mind. Over a period of I think almost 16 years we have already had a system under which grocer’s liquor licences have been issued. In the course of all those years we only issued 56 such licences. Consequently that ought to be an indication to hon. members that the Liquor Board does not make these licences readily available. Cognizance is taken of the requirements, in precisely the same way as in the case of the issuing of a liquor licence. Only in cases where the Liquor Board is satisfied that a freer distribution will occur for the sake of fair consumption by reasonable people will a licence or permission for introducing a wine counter be granted.

The hon. member for Umbilo, in the spirit of great reform, adopted a standpoint which was opposed to any form of liquor consumption. He said that if one examined the amendments which had been effected in the course of the years to the principal Act, it was clear that all these amendments were aimed at effecting a freer distribution of liquor. Actually this is an argument which can also be used to prove how strict our liquor legislation is. When we look at the Liquor Act, I believe that those who are going to vote against this Bill will have to agree with me that we in South Africa probably have one of the strictest liquor acts in the world.

That is correct.

The control, distribution and consumption of liquor are all regulated by the Liquor Act. While the hon. member was speaking I paged quickly through the Liquor Act. In the first place there is the question of licences. Hon. members know how difficult it is for one to obtain a licence to sell liquor.

†There are no ties, no take-overs. None of these will be allowed, but is prohibited. Every single page of the Liquor Act is full of restrictions curbing the freer availability of liquor. For instance, provision is made for hours during which liquor may be sold.

Yes, but those have been extended.

They may have been extended, but the fact remains that they are still circumscribed.

But they have been extended and you keep on removing restrictions.

They have been extended only slightly. The Liquor Board has a tight hold on the whole distribution of liquor. The Liquor Act stipulates who may be served, who may be served in bars, who may serve in a bar, who may drink liquor, on what days liquor sales are prohibited, who may hold a licence and who may not hold a licence, etc. There are restrictions on club licences. There are 101 aspects. Section 163 of the Act for instance provides for the so-called black list.

Club licences have been relaxed.

We relaxed some of the restrictions. Nevertheless, the Act still provides for a tremendously tight hold on the distribution of liquor. The population grows. There is more activity among people. Somewhere one has to relax restrictions.

The pressure is not to relax them.

I believe, that this is a very logical Act. I think the hon. member should really have thanked us for the temperance that is built into this Act. One can say that this Act is a Temperance Act. There is no doubt about it.

Why do you not call it the Temperance Act then, Jimmy?

Mr. Speaker, that is definitely the case. [Interjections.] South Africa’s Liquor Act is the strictest Act in the world. Hon. members can ascertain this for themselves.

Let us keep it that way.

Of course, we want to keep it that way. I am with the hon. member on that.

*Now I just want to reply to a few of the arguments put forward by hon. members before I come to my general statements. The hon. member for Port Elizabeth Central asked me a very interesting question. Unfortunately the hon. member is not present in this House at the moment. He wanted to know why, when liquor can be bought at one supermarket, this cannot be done at all supermarkets. If such an argument were valid, one might just as well have deleted the Act in its entirety, telling people that they could sell wherever, whenever and however they liked. Only then will we be conducting a debate on the distribution of liquor. Consequently that is not a valid argument from the hon. member here. The interesting part of his argument is that it affords me the opportunity to tell hon. members that we do in fact have a liquor industry. We cannot run away from that. We do have a liquor industry. We do have wine farmers. We do have a wholesale and retail distribution of liquor. We have liquor licences. We have hotels and we supply liquor to Black people, to Indians and to Coloureds. When we consider the liquor industry as it exists today—it has been my task, over the course of years, to make a study of the liquor industry—it appears that there is a tendency in the liquor industry which is clearly moving in the direction of a monopoly. There are a few large wholesale producers who are, so to speak, at one another’s throats. It is the task of the Liquor Board to prevent these few giants from eradicating one another and then placing a tremendous pressure on liquor sales by means of advertisements and other promotional projects. The Bill which is at present before the House is in essence only a part of a scheme which the department is working out with a view to the better distribution of liquor. We propose to ensure a better liquor distribution system to ensure that no monopolistic tendencies will develop, because the incidence of such tendencies could entail a tremendous explosion in the distribution of liquor.

That is why I informed this House that it is the policy of the department first to stimulate the independent liquor store licence by giving him the right to have a wine counter in a grocery shop. He must be completely free of any ties to a producer wholesaler and the shop in which he sells must similarly not be a tied shop. We are consequently promoting an anti-monopolistic situation. That is something which the hon. members did not discuss. They merely spoke for or against the distribution of liquor. It is not that I have anything against it…

No, be fair now. I said…

You think that because you are wearing a red flower in your lapel…

I see the hon. member for Durban Point is wearing a red flower this evening. I concede that argument to him.

The red flower has to do with the distribution of votes, not with the distribution of liquor. [Interjections.]

Sir, we have now listened to the pros and cons of liquor distribution in general. Nevertheless I am pleased that the debate, in spite of the fact that the specific point envisaged by the Bill was missed completely in the course of the debate. I am pleased at the course the debate has taken, because the various temperance leagues like to make their voices heard. They must make their voices heard, and this House is the very place to do so. The hon. member did so in a particularly good way. I agree with every word the hon. member said.

However, if the hon. members have been in my position and have been saddled with the administration of the Liquor Act, which would entail their being faced with the practical situation, they in turn would have agreed with me. The situation as far as the distribution of liquor is concerned is that there are wholesalers, and that millions of rands are made from liquor. Large purchases are made, take-overs occur and there is a tremendous struggle throughout the whole field of liquor distribution. If I introduce measures to keep the distribution of liquor clean and on a healthy level, hon. members must support me. I want to repeat that I am not opposed to their standpoint; I support it. In fact, the legislation is also in favour of their standpoint, for what we have here is restrictive legislation and not free legislation. If the hon. members feel that we are getting rid of certain restrictions too rapidly, they must tell me and then we could debate that point instead.

Hon. members can go and examine the licences if they wish. All the licences under discussion here are licences which were issued in the course of time on the basis that there was a reasonable need for the proper distribution of liquor. All that has been achieved in this way is a distribution of liquor sales. Liquor sales show a normal turnover, although there is an increase in the turnover every year. However, the increase must be attributed to an increase in the population and also to the fact that more money is always coming into circulation. That is quite normal. All we are doing is to ensure that liquor sales will be spread over the entire spectrum of our national life.

The hon. member for Innesdal adopted a general standpoint with which I cannot find any fault. He stated that if liquor is not available people will nevertheless manage to obtain it That this is true was surely proved in America, for when liquor was withheld from the American, he still managed to obtain it. Liquor was smuggled into America at night in ships. In the time of prohibition in America one could even ask a policeman in New York where one could obtain liquor. Of course this was all illicit liquor which one was able to obtain. I want to tell the hon. member for Innesdal that if he knows anything about liquor distribution he will know that in Soweto alone there are more than 4 000 shebeens. The people of Soweto did not have free distribution of liquor, and so they quite simply created a freer distribution for themselves. Tons of liquor find their way illegally to these shebeens, where it is mixed with all kinds of other liquor. It is matters such as these to which attention has to be given under the provisions of the Liquor Act.

What is involved here is not total abstinence, but control. What is involved is better distribution, and that is what we are doing. That is why I asked hon. members to help me in this attempt. I repeat that I am grateful that we were able to have such a long debate on this matter. It is an important matter in our national life. It is a good thing that our people are aware that there is strong resistance to a wider distribution of liquor. It is a commendable standpoint and I support it. I want to ask hon. members on this side of the House to support this Bill because it is in fact aimed at implementing what hon. members in general were asking for.

Question put,

Upon which the House divided:

As fewer than 15 members (viz. Messrs. T. Aronson, J. F. Marais, G. N. Oldfield, P. A. Pyper, W. V. Raw, D. H. Rossouw, H. H. Schwarz, Dr. F. van Z. Slabbert, Mr. W. M. Sutton, Mrs. H. Suzman, Messrs. R. A. F. Swart, A. B. Widman and N. B. Wood) appeared on one side,

Question declared agreed to.

Bill read a Third Time.

Mr. Speaker, I move—

Agreed to.